New Europe Print Edition Issue 1011

NEWEUROPE19th Year of Publication | Number 1011 | 16 - 22 December, 2012 | € 3.50 www.neurope.eu

Amnesty International has described as“historic” a decision by the EuropeanCourt of Human Rights that the FormerYugoslav Republic of Macedonia(FYROM) was in violation of theEuropean provision on prohibition oftorture.

According to the human rights organ-isation, the ruling “for the first timeholds a European state accountable forits involvement in the secret US-led pro-grammes and is a milestone in the fightagainst impunity”.

The case concerned the violation ofhuman rights of Khaled El-Masri (pic-tured left), a German national ofLebanese origin.

El-Masri arrived in FYROM by bus in2003 when he was arrested at the bordercrossing by the police. Taken to a hotel inSkopje, he was kept there locked for 23

days about his alleged ties with terroristorganisations.

Unable to contact the Germanembassy, he was then taken, handcuffedand blindfolded, to Skopje Airportwhere he was severely beaten by dis-guised men.

Being forcibly taken to an aircraft, hewas thrown to the floor, chained downand forcibly tranquillised by, in hiswords, a ‘CIA rendition team’.

El-Masri was flown to Afghanistanwhere, according to his submissions, hewas kept for over four months in a small,dirty, dark concrete cell in a brick factorynear Kabul, where he was repeatedlyinterrogated and was beaten, kicked andthreatened. The court held that theauthorities in Skopje were to pay KhaledEl-Masri €60,000 in respect of non-pecuniary damage.

After several months of proposals, counter-proposals, consultations and negotiations, adeal was struck on 13 December in Brusselson EU “banking supervision.” The agree-ment was praised by all governments offi-cials, including the eurosceptic BritishChancellor of the Exchequer, GeorgeOsborne, who said that the city’s financialindependence was preserved.

Although the technical details have stillto be worked out, the main features of theagreement are already known. First, it con-cerns only the 150 biggest Europeanfinancial institutions (as Germany hadproposed), but can be extended to coverany other of the 6,000 banks of the conti-nent, in case of complaint (as France want-ed). Secondly, it primarily covers Eurozonebanks, but non-euro member countries canalso participate on a voluntary basis.

Banking supervision for the big “systemic”banks is delegated to the European CentralBank (ECB), while the smaller banks will bemonitored by their local central banks.Under the agreement, which will enter inforce in March 2014, a resolution authorityand a bank guarantee scheme will have to beestablished. In case of problem, the resolu-tion authority (and not the local centralbank) will have the responsibility to decidewhether a bank should be put in liquidation,or should be recapitalized. Most important-ly, recapitalization will be occur through theEuropean Stability Mechanism (ESM), theEU rescue fund, an institution that current-ly holds 500 billion euro assets. Interestingly,

the bailout funds will be not be tax-payermoney, but contributions of the same com-mercial banks participating in the scheme.

Although, the agreement is a decisivestep towards European integration andmonetary stability, several bank officialshave raised questions about the effectivefunctioning of the mechanism. Forinstance, Jens Weidmann, the head of theGerman Bundesbank, was puzzled aboutECB’ s capacity to effectively supervisesuch a big number of commercial banks“For practical reasons, one could havedrawn the circle of systemically relevantbanks a little bit tighter,” he said, and he

also doubted that the ECB GoverningCouncil is the ideal body to decidewhether a bank should be closed or not.

As a matter of fact, it is really challengingfor the ECB to establish within a period ofonly 14 months, an efficient monitoringmechanism even for the 150 EU big sys-temic banks. The issue will be even moredifficult, if to the “regular” supervision, oneadds the smaller bank cases, brought to theattention ECB.

In any case, the agreement is a leap for-ward for the stabilization of the commoncurrency, and brings the Eurozone one stepcloser to a real union.

ECB to control Eurozone's top banks

FYROM accountable for torture

Banking deal struckGENDERActivists, politicians, entre-preneurs and journalists from28 countries gathered inLondon from 4-5 Decemberfor the Trust Women Con-ference... ·0

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DALLIGATEIn the answers to the 154questions sent by theEuropean Parliament tothe Commission about thedeparture of John Dalli...

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ECONOMYThe EU’s austerity packagewas condemned by leadingeconomist, James Galbraith,who also had harsh words forthe Troika, currently overseeingGreek finances... ·Page 11

HUMAN RIGHTSPromoting and protectinghuman rights are a corner-stone of Irish foreign policy.Starting in January, Irelandwill hold a seat, for the firsttime... ·Page 6

European Council President Herman Van Rompuy, and Commission President Jose Manuel Barroso,during a press conference after the second day of the EU heads of state and government in Brusselson 14 December.

On 13 December, the price of oil fell tonear $86 a barrel after budget negotia-tions in Washington reached an appar-ent impasse, signalling a slowdown inthe US economy and lower oil demand.By early afternoon in Europe, bench-mark oil for January delivery was down60 cents to $86.17 a barrel in electron-ic trading on the New York MercantileExchange.

Oil prices fall

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By CHRISTOS KISSAS

Ken Loach in anexclusive interview...

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ARTS &CULTURE

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NE 10 YEARS AGOHe was delighted until he discovered it was only a bronze |AFP PHOTO / POOL / Vegard Grott

The Shooting Gallery

The EU found a bit of cash to help settle the accession process, but the headline of settled borders looks a little tem-porary, for we still have no indication of where the eventual border of the EU could be. Could Turkey's membership,if it ever happens, lead to expansion northwards, or even around the Mediterranean? Perhaps like Alexander, we aresetting out to conquer until we run out of steam, momentum and a willing army of eurocrats. Ukraine and Gazpromsigned agreements to co-operate, which didn't end up as a complete success and Deutsche Post bought haulage car-rier DHL, hoping, no doubt, to make a packet. Still, let's take a lesson from this week, 10 years ago, for Copenhagenhosted a successful summit. Will it do so again?

A revolting situation“This is a good week for the European Union, a week to beremembered,” according to European Council president,Herman Van Rompuy, an optimistic assessment based on theEU being presented with the Nobel peace prize in Oslo, thefirst steps towards a banking union being taken, and an agree-ment that will see Greece get some much needed cash to propup its ailing economy.“The worst is now behind us”, he insists. Even member states at odds with wider EU policy havebeen somewhat positive this week, although may baulk atthe wide-eyed sentiments of Van Rompuy. Chief amongstthese countries is the United Kingdom (although by nomeans the only one). Despite being on the periphery ofEU integration, Prime Minister David Cameron has saidthe UK will not scupper the plans of other member states,a magnanimity borne out of the belief that a strongEurozone will bolster British trade ambitions. Of course,anyone who feels the PM is going a bit soft on Europe, hetook a stand by not turning up at the Nobel prize-givingceremony in Oslo. Self-congratulation is not for him.Cameron, in the grand tradition of Conservative Party leaders,faces battles over Europe; most recently a couple of backbenchrebellions on an EU referendum and on the bloc’s long-termbudget. The next fight may well be on gay marriage.Eurosceptic party, Ukip, have pledged to campaign on this veryissue at the 2014 European Parliament elections. Same-sexmarriage is something Cameron sincerely believes in; theprime minister has said that marriage is the bedrock of a securesociety and does not want to see it denied to anyone. This week, after a series of compromises that many have founduncomfortable, the UK parliament published a bill whichwould see gay marriage legalised in the country. Nigel Farage,Ukip leader, has said this is a European issue; one tangled-upwith the European Court of Human Rights, the Eurosceptics’bette noire, the destroyer of the Magna Carta. Some membersof the clergy are even claiming that the exemptions on same-sex marriage given to them by one of the bill’s compromiseswill, in fact, be invalid, incompatible with the EU’s fundamen-tal charter on human rights. The government has denied this,but the seeds are sown. David Cameron is inviting interferenceinto UK sovereign law from Brussels and Strasbourg. Farage also claims that Conservative members are leaving theparty in droves, disgusted at Cameron’s modernising plans, andare swelling the ranks of Ukip, whose traditional conservatismis strong and glorious, and ready to rule Britannia under thedual stewardship of Winston Churchill and Air Chief MarshalSir Arthur Travis Harris. To date, the highest profile defectorhas been Neil Hamilton, the MP whose political career endedin ignominy following the ‘cash for questions’ scandal in 1994.The 63 year-old was also seen recently at the Ukip youthwing’s Christmas party.Cameron is facing a right-wing backlash. He is certainly astuteenough to ride it out; but the lessons form history are there.The prime minister, to get the same-sex marriage legislationpassed, will certainly need the support of the oppositionLabour Party. In 2006, Tony Blair needed opposition supportto push through some contentious education reforms. True; thebill was passed, but at the expense of Blair’s credibility and gripon power. The knives are already been sharpened for Cameron,from within and without. He needs to tread carefully.If passed, the laws on same-sex marriage come into force at thebeginning of 2014, shortly before the European elections.

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02NEW EUROPE16 - 22 December, 2012 ANALYSIS

03NEW EUROPE16 - 22 December, 2012

ANALYSIS

CAMBRIDGE – It’s official. The Inter-national Monetary Fund has put its stampof approval on capital controls, thereby le-gitimizing the use of taxes and other re-strictions on cross-border financial flows.

Not long ago, the IMF pushed hard forcountries – rich or poor – to open up toforeign finance. Now it has acknowledgedthe reality that financial globalization canbe disruptive – inducing financial crisesand economically adverse currency move-ments.

So here we are with yet another twist inthe never-ending saga of our love/hate re-lationship with capital controls.

nder the classical Gold Standard thatprevailed until 1914, free capital mobilityhad been sacrosanct. But the turbulenceof the interwar period convinced many –most famously John Maynard Keynes –that an open capital account is incompat-ible with macroeconomic stability. Thenew consensus was reflected in the Bret-ton Woods agreement of 1944, which en-shrined capital controls in the IMF’sArticles of Agreement. As Keynes said atthe time, “what used to be heresy is nowendorsed as orthodoxy.”

By the late 1980’s, however, policymak-ers had become re-enamored with capitalmobility. The European Union made cap-ital controls illegal in 1992, and the Or-ganization for Economic Cooperationand Development enforced free financeon its new members, paving the way forfinancial crises in Mexico and SouthKorea in 1994 and 1997, respectively. TheIMF adopted the agenda wholeheartedly,and its leadership sought (unsuccessfully)to amend the Articles of Agreement togive the Fund formal powers over capital-account policies in its member states.

As long as it was developing countriesthat were whipsawed by global finance, itwas fashionable to blame the victim. TheIMF and Western economists argued thatgovernments in Mexico, South Korea,Brazil, Turkey, and elsewhere had notadopted the policies – prudential regula-tions, fiscal restraint, and monetary con-trols – needed to take advantage of capitalflows and prevent crises. The problem waswith domestic policies, not with financialglobalization, so the solution lay not incontrols on cross-border financial flows,but in domestic reforms.

Once the advanced countries becamevictims of financial globalization, in 2008,it became harder to sustain this line of ar-gument. It became clearer that the prob-lem lay with instability in the globalfinancial system itself – the bouts of eu-phoria and bubbles, followed by the sud-den stops and sharp reversals that areendemic to unsupervised and unregulatedfinancial markets. The IMF’s recognition

that it is appropriate for countries to tryto insulate themselves from these patternsis therefore welcome – and comes nonetoo soon.

But we should not exaggerate the extentof the IMF’s change of heart. The Fundstill regards free capital mobility as anideal toward which all countries will even-tually converge. This requires only thatcountries achieve the threshold conditionsof adequate “financial and institutionaldevelopment.”

The IMF treats capital controls as a lastresort, to be deployed under a rather nar-row set of circumstances – when othermacro, financial, or prudential measuresfail to stem the tide of inflows, the ex-change rate is decidedly overvalued, theeconomy is overheating, and foreign re-serves are already adequate. So, while theFund lays out an “integrated approach tocapital flow liberalization,” and specifies adetailed sequence of reforms, there isnothing remotely comparable on capitalcontrols and how to render them more ef-fective.

This reflects over-optimism on twofronts: first, about how well policy can befine-tuned to target directly the underly-ing failures that make global finance un-safe; and, second, about the extent towhich convergence in domestic financialregulations will attenuate the need forcross-border management of flows.

The first point can be best seen usingan analogy with gun controls. Guns, like

capital flows, have their legitimate uses,but they can also produce catastrophicconsequences when used accidentally orplaced in the wrong hands.

The IMF’s reluctant endorsement ofcapital controls resembles the attitude ofgun-control opponents: policymakersshould target the harmful behavior ratherthan bluntly restrict individual freedoms.As America’s gun lobby puts it, “Gunsdon’t kill people; people kill people.” Theimplication is that we should punish of-fenders rather than restrict gun circula-tion. Similarly, policymakers shouldensure that financial-market participantsfully internalize the risks that they as-sume, rather than tax or restrict certaintypes of transactions.

But, as Princeton economist AvinashDixit likes to say, the world is always sec-ond-best at best. An approach that pre-sumes that we can identify and directlyregulate problematic behavior is unrealis-tic. Most societies control guns directlybecause we cannot monitor and disciplinebehavior perfectly, and the social costs offailure are high. Similarly, caution dictatesdirect regulation of cross-border flows. Inboth cases, regulating or prohibiting cer-tain transactions is a second-best strategyin a world where the ideal may be unat-tainable.

The second complication is that, ratherthan converging, domestic models of fi-nancial regulation are multiplying, evenamong advanced countries with well-de-

veloped institutions. Along the efficiencyfrontier of financial regulation, one needsto consider the tradeoff between financialinnovation and financial stability. Themore of one we want, the less of the otherwe can have. Some countries will opt forgreater stability, imposing tough capitaland liquidity requirements on their banks,while others may favor greater innovationand adopt a lighter regulatory touch.

Free capital mobility poses a severe dif-ficulty here. Borrowers and lenders can re-sort to cross-border financial flows toevade domestic controls and erode the in-tegrity of regulatory standards at home.To prevent such regulatory arbitrage, do-mestic regulators may be forced to takemeasures against financial transactionsoriginating from jurisdictions with morelax regulations.

A world in which different sovereignsregulate finance in diverse ways requirestraffic rules to manage the intersection ofseparate national policies. The assumptionthat all countries will converge on theideal of free capital mobility diverts usfrom the hard work of formulating thoserules.

Dani Rodrik, Professor of InternationalPolitical Economy at Harvard University,is the author of The Globalization Para-dox: Democracy and the Future of theWorld Economy.Copyright: Project Syndicate, 2012.www.project-syndicate.org

FINANCE

Global capital rulesBy Dani Rodrik

International Monetary Fund (IMF) Managing Director Christine Lagarde gives a speech during the "Treasury Talks" at French Economy and Finances

Ministry on November 30, 2012 in Paris.

UK Chancellor George Osborne’s AutumnStatement delivered last week provoked in-tense debate over the direction of his eco-nomic policies, with the reduction of debtnow forecast to take longer than expected,Fitch have doubted the UK’s triple-Acredit rating.

Yet again discussions rage on aboutwhether there are other avenues to take, or it’stime to play the longer game and stick withthe plan until there is a return to stablegrowth.

Osborne’s principal announcements cen-tred on an additional £5.5 billion to be spenton infrastructure, an allowance made after apackage of £6.6 billion of savings was put to-gether by cutting government departmentspending, overseas aid and more controver-sially the welfare bill.

The fresh money is aimed to stimulategrowth by being allocated to build schools, aplan for new roads and science investment.There will also be a cut in corporation busi-ness tax by 1% in 2014, and a further £1 bil-lion will be invested in the creation of aBusiness Banks to help small businesses gainaccess to finance.

Although Fitch were left unimpressed bythe confirmation that the public sector debtwould not be falling from 2015/16, whichthey say was a "supplementary target.”

The ratings agency were also unimpressedthat further cuts in fiscal spending were notmade over the next two years, leaving theUK’s fiscal creditability weakened.

This was despite Chancellor Osborne fore-casting the borrowing was going to be £108billion for 2012/13, down by £18 billion fromlast year, although this may be due to ac-counting issues, and that the £3.5 billion saleof the 4G mobile phone services was includedin the figures.

Fitch now forecast the UK’s gross govern-ment debt to peak at 97% of GDP in2015/16, near the very upper limit that un-derpins the triple- A rating, although adowngrading would not be such a disaster ineverybody’s eyes.

“I don’t think that a downgrade will have ahuge effect on the real economy,” SaidSamuel Tombs, UK economist for macroeco-nomic research company Capital Economics.

“When we have seen other countries re-ceive a downgrade we have not really seen a

negative reaction from the markets. TheUnited States and France have both suffereddowngrades, but the markets looked for a re-sponse from the government over its auster-ity methods and ways to harness growth.”

He explained: “There are some people thatbelieve that due to the fact that we have lowinterest rates that we should borrow more.The chancellor probably has had more roomto spend that may not have caused a ripple inthe markets. The coalition are unlikely to re-verse their cuts, and some kind of austerityplan has to remain to support the economy.”

Earlier this year in response to the UKfalling into a double dip recession Osbornedid announce measures that he hoped wouldfoster growth, such as £50 billion in loanguarantees for infrastructure projects, wherethe government will underwrite schemes thatare ‘shovel ready’ where financing has driedup from the private sector. This was passedthrough parliament and finalised as a bill inOctober leaving it to progress in the new year.

To increase lending the Funding for Lend-ing Scheme (FLS) is now open until Febru-ary 2014 where the aim is to provide credit tohouseholds and businesses. Banks will havethe incentive to lend more money out into theeconomy, as those that lend more can borrowmore from the FLS, where the borrowing feewill be 0.25% per year that would increase if

levels of lending decline. Also let’s not forget an extra £50 billion in

quantitative easing released in the summer topurchase government bonds from financialinstitutions.

Surprisingly UK growth figures jumpedto 1% in the third quarter for this year, afterthree negative quarters that plunged theminto a double dip recession with worse fig-ures than even the Euro Zone. Althoughsuspicions remain whether hosting theOlympics, and the golden jubilee celebra-tions for Queen Elizabeth II has handedthe economy a sticking plaster that has par-tially covered the wound.

The Independent Office of Budget Re-sponsibility (OBR) are optimistic overgrowth over the next few years, as part of thechancellor’s Autumn Statement the OBRpredicts that the growth 1.3% next year, 2% in2014 eventually climbing to 2.8% in 2017. InMarch they also optimistically forecast thatthe next two years would grow by 2% and2.7% respectively, so the latest projectionshave been dismissed by some the govern-ment’s critics.

Jonathan Portes, director of the NationalInstitute for Social and Economic Research,outlines some of the spending cards that Os-borne can play, without affecting interestrates, as this coalition government has con-

sistently reiterated, as debt to GDP has nowreached 86% say the latest Eurostat figures.

“I don’t think that borrowing more moneywill affect interest rates, the chancellorcould borrow more to restore some of thedamaging cuts and policies that have beeninflicted over the last three years. As forwhere you could invest the money you couldlook at infrastructure such as roads, housingand you could also implement employmentcreating measures such as a national insur-ance holiday.”

“The OBR growth figures are not that dif-ferent from the ones that we would suggest,but that depends on what happens to achievea decent recovery. After five years since thecrash our output is 3% lower than what it wasthen which is dismal, and we could borrowmore money to stimulate the economy andnot have a significant impact on interestrates.”

What was clear from the Autumn State-ment is that the chancellor now knows thatreducing the debt and the recovery will nowtake longer than originally expected when hemoved in 11 Downing Street.

The coalition government will be highlyunlikely to be able to offer any sweetenersfrom the results of austerity before the nextelection in 2015, and that should keep the de-bate raging on.

ECONOMY

UK recovery to take longer than expectedBy Peter Taberner


ANALYSIS

A longer stretch for the British pound.

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Promoting and protecting human rights area cornerstone of Irish foreign policy. Start-ing in January, Ireland will hold a seat, forthe first time, on the United NationsHuman Rights Council. Membership ofthe Council is a signal honour and privilegefor Ireland. It testifies to the strong reputa-tion we have built up in the area of interna-tional human rights advocacy. It alsofollows on from Ireland’s successful chair-manship of the Organization for Securityand Co-operation in Europe (OSCE), theworld’s largest regional security body whichsince its founding has recognized that truesecurity must encompass not only political-military matters but prosperity, environ-mental sustainability and human rights.

As OSCE chair we recently hosted a meet-ing of foreign ministers in Dublin, the Minis-terial Council, where we sought to agreedecisions to guide the organization’s futurework. The 57-state OSCE works by consen-sus, no small challenge in a body that brings to-gether the United States, the European Unionand Russia, among other countries. Despite ourbest efforts, the states were not able agree deci-sions in the so-called “human dimension” of theOSCE, a worrying trend seen at recent Min-isterial Councils.

This inability to come together is sympto-matic of a greater concern: respect for humanrights and fundamental freedoms is undergrave threat in many parts of the OSCE area.We must do more to ensure that these com-mitments and obligations are honoured.

I remain cautiously optimistic that we canachieve progress here, despite the absence ofconsensus on human rights issues that we haveseen at the OSCE in recent years. And despitethe less than positive news to come out of theMinisterial Council when it came to thehuman dimension of the OSCE’s work, oneimportant achievement worth noting is theagreement on a Declaration on StrengtheningGood Governance.

The declaration makes clear that problemsof governance, including corruption andmoney-laundering, undermine social cohesion,stability and security, and acknowledges thatweak governance can be conducive to thespread of terrorism. It will enable the OSCE todeepen its work to help states prevent andcounter corruption, a terrible blight on societiesthat hinders development and underminesdemocratic institutions.

Critically, at the core of this declaration ofsupport for promoting good governance andtransparency is the reaffirmation that rule oflaw and respect for human rights are crucial tocreating a climate of confidence necessary forpositive economic and social development. InJanuary, Ireland takes over as EU Presidency,with a clear focus on jobs, growth and innova-tion. This agenda can only prosper in tandemwith a commitment to the highest standards ofgovernance and I am determined to keep thisissue at the heart of our Presidency.

The declaration also recognizes the impor-tance of protecting whistleblowers and theirclose family members, whether in the public or

private sector. Whistleblowers play a key rolein preventing and detecting corruption, and itis in the public interest that people who comeforward can do so without fear of retaliation,intimidation or harm.

It calls for strengthening the dialogue andco-operation between governments, civil soci-ety and the private sector in order to supportgood governance efforts, and acknowledges therole that freedom of information and access toinformation play in fostering openness and ac-countability. More specifically, the declarationrecognizes the need to enhance the implemen-tation of anti-corruption commitments by in-volving civil society and business, includingthrough the mechanism for the review of theimplementation of the UN Convention againstCorruption.

The declaration underscores the importanceof safeguarding the judiciary’s independence inthe fight against corruption and to uphold therule of law, and also further supports measuresto strengthen international cooperation, notleast in the recovery of stolen assets and to en-sure that the proceeds of corruption can find

no safe haven.Words on paper, to be sure, but they repre-

sent a significant political commitment on thepart of 57 states in Europe, Asia and NorthAmerica to strengthen good governance andtransparency, and a recognition that these com-mitments cut across all areas of the OSCE’swork, including the human dimension. Thisprovides a solid foundation on which we canbuild, and I hope in this way bridge the worry-ing divide between our countries that hasstymied our efforts at achieving broader con-sensus.

If we are being true to our comprehensiveapproach to security we cannot let humanrights and human security fall victim to dis-agreement. As all OSCE states have agreed, theprotection and promotion of human rights andfundamental freedoms are our first responsibil-ity. Now we must live up to it.

Eamon Gilmore, Ireland's Tánaiste (DeputyPrime Minister) and Minister for Foreign Af-fairs and Trade, is the 2012 OSCE Chairper-son-in-Office.

HUMAN RIGHTS

Strengthening good governance and human rights


ANALYSIS

US Secretary of State Hillary Clinton delivers a speech 'Frontlines and Frontiers: Making Human Rights a Human Reality' at Dublin City University in Ireland on 6 De-

cember, where she issued a sharp warning to European and central Asian nations that some countries were backsliding on democratic values and human rights.

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Inventors across theEuropean Unionwill soon be able toget a unitarypatent. After over30 years of talks, anew regime will cutthe cost of an EU

patent by up to 80%, making it morecompetitive compared to the US andJapan. The European Parliament todayapproved the so-called “EU patent pack-age” (unitary patent, language regime

and unified patent court).Intellectual property obviously does notstop at borders. Today’s vote is good newsfor EU economy and especially for Euro-pean small and medium enterprises(SMEs).As a member of the European ParliamentLegal Affairs Committee, I know that peo-ple in China are telling us that we cannothave a single market without a unitarypatent. With the new rules a lot of obstaclesfor SMEs will be overcome.The new patent will be cheaper and moreeffective than current systems in protect-ing the inventions of individuals and

firms. Any inventor will be able to apply tothe European Patent Organisation (EPO,a non-EU body) for an EU unitary patentvalid in all 25 EU member states takingpart. Patents will be made available inEnglish, French and German. Applica-tions will have to be made in English,German or French. If made in anotherlanguage, they will have to be accompa-nied by a translation into one of thesethree languages. Renewal fees, whichaccount for a large share of total costs, willbe set at a level that takes account of thespecial needs of small firms, so that theycan benefit fully from lower costs.

The international agreement creating a uni-fied patent court will enter into force on 1January 2014 or after thirteen contractingstates ratify it, provided that UK, Franceand Germany are among them. The othertwo acts would apply from 1 January 2014,or from the date when the internationalagreement enters into force, whichever isthe latest. Spain and Italy are currently out-side the new regime, but could decide tojoin in at any time.

Mary Honeyball (UK, S&D) is a memberof the European Parliament’s committee onculture and education.

UNEMPLOYMENT

The European Parliament approves EU-wide unitary patent rules

By Eamon Gilmore

By Mary Honeyball MEP


The funniest TV clip I've seen all year wasbroadcast in January. It featured an inter-view with Paula Broadwell many monthsbefore her affair with David Petraeus be-came public knowledge and forced hisresignation as director of the CIA. "Thereal controversy here is: is he awesome orincredibly awesome?" The Daily Showhost Jon Stewart said to Broadwell's face.With that brilliant put-down, Stewartunderscored how her biography of Pe-traeus was an exercise in fawning.

At least Broadwell can point to howshe was sleeping with her subject in mit-igation. Lots of journalists have flimsierexcuses for why they pander to the pow-erful. Take Bill Emmott: as editor of TheEconomist, he displayed his slavish devo-tion to the British establishment by in-sisting that the magazine support the waragainst Iraq.

Today, Emmott chairs the Canada-Europe Roundtable for Business(CERT), along with Roy MacLaren, aformer minister in the Ottawa govern-ment. The two men want to convince usthat a free trade deal between the EU andCanada will bring tangible benefits to or-dinary people on both sides of the At-lantic. But why should we take themseriously when both are wealthy elitists?Both are active in the Trilateral Commis-sion, an unelected group of political andbusiness leaders that holds an invitation-only confab about how the world shouldbe run every few months. (This isn't aconspiracy theory; it's a statement of fact).

CERT could soon be celebrating.There are strong signals that the tradedeal it covets will be signed in the near fu-ture. To show that this is no ordinary deal,it will have a fancy title: the Comprehen-sive Economic and Trade Agreement(CETA).

Documents that I have seen prove thatcorporations have been pushing for an ac-cord that will give them the wherewithal

to overturn labour and environmentallaws which they perceive as barriers tomaking profit. Xstrata, the mining giantlinked lately to Emmott's chum TonyBlair, has made specific proposals aboutthe "dispute resolution" provision that islikely to be part of the trade deal. Thisprovision will allow companies to sue theEU or Canada over measures or decisionsthey dislike. In a 2011 letter, John Smil-lie from Xstrata Nickel complained thatREACH - the Union's main law onchemicals - can lead to substances beingbanned from the entire EU market basedon the hazards they present.

"The challenge for any dispute resolu-tion mechanism is how does it engagewith a process that has no economic con-sideration and yet can have a very severeeconomic impact?" he wrote. "If the dis-pute resolution mechanism does not havethe 'teeth' to deal with these sorts of is-sues, it is just another tariff-based tradeagreement, and not the landmark, com-prehensive and ambitious frameworkagreement that is being claimed and, weunderstand, both sides want."

Regardless of Smillie's concerns, thedeal looks like it will be comprehensiveand ambitious. An internal briefing paperwritten by the European Commissionlast month indicates that a dispute reso-lution mechanism will be included butthat there was some difference of opinionabout what it should cover. There is noth-ing in the paper to suggest that the Com-mission has told Xstrata or any othercompany that rules designed to protectnature and human health cannot be di-luted on the say-so of a chief executiveand his legal team. On the contrary, EUofficials are pushing for a mechanismwith "teeth".

CERT has breezily dismissed protestsagainst the trade talks. When the Na-tional Union of Public and General Em-ployees and several other Canadiangroups called for transparency about whatwas under negotiation, CERT's Jason

Langrish sent a "for your information"note to his contacts in Brussels. "Not amajor concern, but shows engagement,"he wrote.

Langrish is an ideological warrior. In aseparate email message, he argued thatOntario's state-controlled alcohol shopsshould be privatised. "We would like tobe able to buy our wine at the corner storeat whatever time we want like anywhereelse in the world. Most people recognisethat the government really shouldn't bein an area where business can do the samejob as well, if not better. It isn't health care,after all."

His pay-off line was misleading.CERT and its partner BusinessEuropehave seen the trade talks as an opportu-nity to fundamentally transform Cana-dian health care. At their behest, theEuropean Commission has advocatedthat large pharmaceutical companiesshould enjoy more robust "protections"for their "intellectual property" as a resultCETA. Most particularly, the Commis-sion wants Canada to introduce new re-strictions of up to a decade on sellingnon-branded versions of patented medi-cines. A study carried out for the Cana-dian Generic Pharmaceutical Associationhas calculated that the EU's demandscould push up the cost of medicine plansby $2.8 billion per year. Most of the extraspending will fall on provincial authori-ties, which cover 45% of prescription drugspending in Canada, according to thestudy.

It appears that the EU is attempting todamage Canada's health system - untilnow, much better than America's. Povertyamong Canada's elderly has been risingsince the mid-1990s - after two decadesof being reduced. The old will inevitablysuffer most if medical bills rise. Why doBrussels officials want to make senior cit-izens poorer? Will the EU simply do any-thing that Big Pharma asks it to? Is thisthe kind of behaviour we can expect fromrecipients of the Nobel Peace Prize?

Xstrata Nickel have complained about the EU's directives on chemicals.

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Canada trade deal threatensEurope's environment

By David Cronin

ANALYSIS

French economyunder strain

The French economy has been hit by bad news after the Bankof France said that it expects growth to contract by 0.1% in thefourth quarter of this year, while official statistics body theINSEE said that industry output has decreased in October by0.7%. The forecast by the Bank of France repeated their Oc-tober assertion of a contraction, and if proven could affect thecurrent level of growth which official figures say stands at 0.2%for the third quarter of this year, the same level of growth as thebeginning of 2012. Latest figures from the INSEE are more damaging, with man-ufacturing activity down by 2.3% from the same time last year,despite reaching a stable level over the last three months grow-ing slightly at 0.1%. Construction fared little better, as this sector is also sufferingfrom the recession and since 2011 has shrunk by 1.8%. Payroll employment in the major market sectors also fell for thethird quarter of 2012 with a 0.3% drop equating to a loss of41,700 jobs, a fall of 16,100 jobs from the previous quarter, ex-cluding temporary workers the amount of jobs decreased by10,400. The services sector was the most severely hit with a lossof 33,500 jobs in a single quarter, the large majority of these joblosses hit temporary workers with 31,300 laid off from shortterm contracts, highlighting the precarious situation that theFrench labour market currently finds itself. Francesco Saraceno, a senior economist for the Paris based Ob-servatoire Français des Conjonctures Economiques., said: “I amnot surprised by the figures as the French economy has been ex-periencing difficulties for some time. This is mainly down totwo factors, the crises in the Euro Zone and the lack of com-petitiveness and structural issues that need to be reformed.” “To restore the competitiveness needed France needs to reduceits labour costs as there is more competition now from theemerging economies, but also France cannot be like China, andneeds to produce high value products that are better than whatothers produce like what Germany have done.” Economic growth in France has been stable but remains at theslow pace, public debt as a ratio to GDP remains high at 86%,but with benchmark interest rates flat lined for the last fivemonths at 0.7% and the rates on ten year government bonds re-duced over most of December to under 2%, there could beroom for more fiscal activity for next year.“There need to be a balanced package of austerity with labourreform to boost the profits of companies, and investment andspending so that the consumers have jobs and money to spend.We need more skills in the private sector and the public sectorwith the right level of investment in education.” Saraceno added.Another headache for France is the current labour dispute be-tween trade unions and employers, which is finely poised overflexibility issues, where employers want the right reduce thesalaries of their staff without the risk of this turning into an con-structive dismissal dispute. In a potential compromise deal the unions are looking to ensurethat there is more job security for workers on a temporary work-ers, asking for parity contracts with full time staff. Pascal Lagoutte, a partner and the president of French em-ployment law firm Capstan, and a founding member of Ius La-boris global alliance, said: “I am optimistic on the outcome of thenegotiations and that there will be an agreement in place byJanuary that President Hollande wants to happen. If Compa-nies want to for example reduce the working hours to say 30 perweek then they want the freedom to do that.” “It is very important for the future of the French economy tohave reforms like decreasing the costs on contributions suchas health care, and decreasing the cost of social security sothat the economy is more efficient, even thought it may besad to lose services its creates a climate that can be good foremployment. We also need to have flexibility in the hiring ofstaff to create conditions so that everybody is interested ininvesting in France.”

By Peter Taberner


ANALYSIS

The TalentEurope

We believe in the time of the Talent Europe. In theNew Knowledge Society, where the role of the tal-ents as the drivers of Innovation and Creativity ineconomy is becoming more and more important, Eu-rope has a new challenge – to redefine its value chain,to integrate the global networks with new ideas, newsolutions and new proposals of competence. The tal-ent imperative is a contract of trust in this agenda ofchange, an agenda of construction of a new effectivevision for the future.The Talent Europe is the bridge between those thatbelieve in the power of people in creating new solu-tions with new ideas to more complex problems thatare arising in society and those that want innovationand creativity to be the platform of creation of valuein a global competitive economy. The Talent Europeis the confirmation of a process of evolution of theintegration of people in society – the individual con-tribution must be a case of commitment with the or-ganization of society and its main elements. The Talent Europe must be centered in an active en-trepreneurial culture and attitude - people havemost of the times an effective negative attitude to-wards the financial risk, the focus on innovation andthe share of a culture of positive dynamic. We needsociety to have a new challenge. Society must be ableto be the real Platform of a more EntrepreneurialSociety, centered in new areas of knowledge and newsectors of value. In a Modern and Active Society, the key word is Co-creation. To promote a dynamic and active creationprocess involving each citizen is the big challenge forthe next years in society.In the future, a Society of the Ideas must be themost complete example of positive attitude towardsthe future. The Talents must be the new competitiveadvantage of this new Society of the Ideas pushed bythe “enablers” of Modernity, Added Value and Ex-cellence. A very clear idea that suits the big challengethat our society really faces and that requires new an-swers for different questions. The act of global par-ticipation in such a demanding society is an exerciseof commitment between the individual creativity andthe collective cooperation. This is the key for theright future for society.The talents are the key for a contract of ambition.We must understand that in an open society, wherethe integration of people is a signal of a positive con-tribution to the future, the ambition of excellence isessential. We need to believe in the capacity of peo-ple giving society a strategic capability essencial tothe challenges of the future. This is the message ofthe Talent Imperative. This is the message of a newchallenge for people and for society. This is the an-swer of a new generation of talents that know thatthe key for success is based on the contribution withfreedom and equality.

Francisco Jaime Quesado is the General Manager ofthe Innovation and Knowledge Society in Portugal,a public agency with the mission of coordinating thepolicies for Information Society and mobilizing itthrough dissemination, qualification and research ac-tivities. It operates within the Ministry of Science,Technology and Higher Education

New Europe content partner

By Francisco Jaime Quesado

The European Court of Human Rights(ECtHR) ruled that the Former YugoslavRepublic of Macedonia (FYROM) wasin violation of the European provision onprohibition of torture in the case El-Masri v. the Former Yugoslav Republic ofMacedonia.

The case concerned the violation ofhuman rights of Khaled El-Masri, a Ger-man national of Lebanese origin.

El-Masri arrived in FYROM by bus in2003 when he was arrested at the bordercrossing by the police. Taken to a hotel inSkopje, he was kept there locked for 23days about his alleged ties with terroristorganisations.

Unable to contact the German em-bassy, he was then taken, handcuffed andblindfolded, to Skopje Airport where hewas severely beaten by disguised men.

Being forcibly taken to an aircraft, hewas thrown to the floor, chained downand forcibly tranquilised by in his words a‘CIA rendition team’.

El-Masri was flown to Afghanistanwhere, according to his submissions, hewas kept for over four months in a small,dirty, dark concrete cell in a brick factorynear Kabul, where he was repeatedly in-terrogated and was beaten, kicked andthreatened.

After having started two hunger strikes,the applicant was taken by plane to Al-bania and subsequently to Germany.

A claim filed in the United States inDecember 2005 by the American CivilLiberties Union on Mr El-Masri’s behalfagainst the former CIA director and cer-tain unknown CIA agents was dismissed.The court decision, which became finalwith the US Supreme Court’s refusal toreview the case in October 2007, stated in

particular that the State’s interest in pre-serving State secrets outweighed Mr El-Masri’s individual interest in justice.

In addition, the criminal complaintlodged by Mr El-Masri’s representativein October 2008 in FYROM againstunidentified law-enforcement officials onaccount of his unlawful detention and ab-duction was dismissed by the Skopje pub-lic prosecutor in December 2008.

The European Court of HumanRights, however, found that while El-Masri was kept in the hotel, no physicalforce had been used against him. Never-theless, according to the court, ‘his soli-tary incarceration there as part of a secretoperation had to have caused him emo-tional and psychological distress’.

The court emphasised that such treat-ment had been intentionally used withthe aim of extracting information abouthis alleged ties with terrorist organisa-tions. Furthermore, the threat that hewould be shot if he left the hotel roomhad been real and immediate. In that re-spect, the ECtHR concluded that El-Masri’s treatment in the hotel amountedto inhuman and degrading treatment inviolation of Article 3 of the EuropeanConvention on Human Rights.

Moreover, it was found that also El-Masri’s treatment at Skopje Airport at thehands of the CIA rendition team – beingseverely beaten, sodomised, shackled andhooded, and subjected to total sensorydeprivation – had been carried out in thepresence of State officials of FYROMand within its jurisdiction. The govern-ment was therefore responsible for thoseacts performed by foreign officials. Nev-ertheless, the authorities had failed to sub-mit any arguments explaining orjustifying the degree of force used or thenecessity of the invasive and potentially

debasing measures.According to the court, those measures

had been used with the aim to cause theapplicant severe pain or suffering in orderto obtain information which amountedto torture.

Furthermore, FYROM was responsi-ble for exposing El-Masri to the risk offurther treatment in violation of Article 3by having transferred him into the cus-tody of the US authorities.

The decision is final and the Courtheld that the authorities in Skopje wereto pay Khaled El-Masri €60, 000 in re-spect of non-pecuniary damage.

Amnesty International called the rul-ing historic because “for the first time itholds a European state accountable for itsinvolvement in the secret US-led pro-grammes and is a milestone in the fightagainst impunity”.

The organisation said in a statementthat the judgement confirmed the roleFYROM played in the Central Intelli-gence Agency rendition and secret de-tention programmes and called it “animportant step towards accountability forEuropean complicity in rendition andtorture”.The NGO added that FYROMwas not alone and “many other Europeangovernments colluded with the USA toabduct, transfer, ‘disappear’ and torturepeople in the course of rendition opera-tions”. Another human rights activist,Human Rights Watch, said that theUnited States Senate intelligence com-mittee’s review of the CIA's secret deten-tion and interrogation program afterSeptember 11, 2001 had to promptly bedeclassified and released. On 13 Decem-ber the Senate Select Committee on In-telligence adopted the report whichcontains important information on theuse and ineffectiveness of torture.

The ECtHR in session

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FYROM found accountable fortorture in CIA ‘secret rendition’ case

By Stanislava Gaydazhieva

The Courtof Awesome

Over the weekend, I was watching a programme onBloomburg, the financial disaster watch channel, whenthey showed a feature on tech start-up events. It was fullof bright young things, asserting their independence andindividuality as young folk do, by dressing in the same wayand saying “Awesome!” every 10 to 15 seconds.They were pitching ideas to investors, typically peo-ple who had developed something and flogged it offquick before it all fell apart, leaving them to take thekudos and tax breaks offered by their ‘angel’ status.Imagine a cross between real life and instagram and youget the picture. One eager soul announced “We’re look-ing for the next Angry Birds… but with fashion!” Thisdiscovery was not only awesome, but amazing. Yet,strangely, I don’t feel the urge to invest, but someonemight.It all feels, well, infantile. As if they all needed nurtur-ing and positive reinforcement, like a troubled toddler.Everything has to be overstated so much, where everymeaningless thought is ‘inspirational’ every pointlessaction is ‘awesome’ every stupid idea ‘ disruptive’ thata sane observer has to conclude that these people aredivorced from reality and nothing but a drain on Momand Pop’s bank balance.At the age of fifty, whenever one of these little creepstells me I’m awesome, I have an almost uncontrollabledesire to introduce them to the real world via the em-powering bio-mechanism of a fist in the face.That’s what I call a change agent. In time, they willlearn to thank me for this.I say this because there is something not quite rightwith the technophilia that has become the panacea toour ills. It’s all about data, like Google’s mission state-ment (They’ve ditched the ‘Don’t be evil’ thing, possi-bly because evil is highly profitable) say they aim “toorganize the world’s information and make it univer-sally accessible and useful.”One example is Google Earth and their maps. UnlikeApple, whose Australian edition delivers iOS usersinto a deadly desert full of venomous creatures (I meanspiders, snakes, not prank call DJs) instead of theirlocal shopping centre, Google Earth has been rein-venting what a map is. Adding layer upon layer of data, maps are full of everytype of data, blending information in new and oftenuseful ways, but I’m reminded of film maker, WernerHerzog’s question to a scientist gathering technicaldata of the Chauvet cave, home to paintings made35,000 years ago, “It like you are creating the phonedirectory of Manhattan, four million precise entries,but do they dream? Do they cry at night? What aretheir hopes? What are their families? We’ll neverknow from the phone directory.”It is a sense of humanity that is missing, data is only atrace, a footprint of people. We can’t be quantified, la-beled down to the nearest decimal point. Economistsand social scientists have been trying to engineer soci-ety through equations and formula for decades to lit-tle avail, indeed the European Union is the greatest ofthese schemes and look how well that’s doing.The future is not going to be delivered by these selfindulgent hipster clones, the untalented middle class,but from elsewhere. Lets recognize this temporaryphenomenon for what it is and swiftly move on.

[email protected]

By Andy Carling


ANALYSIS

CONSTRUCTIVE AMBIGUITYHUMAN RIGHTS

Uzbekistan: Where law isnow a tool of repression

Twenty years ago this week, Uzbekistanadopted its first constitution as an inde-pendent republic creating the legislativeframework for human rights and democ-racy. Yet, two-decades later, the demo-cratic government and individual libertiesenshrined in the Uzbek constitution bearlittle resemblance to today’s autocraticgovernment which systematically tram-ples on its citizens’ most fundamentalrights. What is even more regrettable isthe EU’s apparent failure to have any gen-uine impact on the improvement of therule of law and democracy in Uzbekistan.This fact underlines the concerns ex-pressed by many on the effectiveness ofEU policy, and of the External ActionService.

According to the principle of the rule oflaw, no one is above the law and all stateofficials must act within the limits of thelaw. Historically, constitutions both guar-anteed the rule of law and created institu-tional frameworks for its realization bystipulating what constitutes the founda-tions of state authority and providing forseparation of powers. The Uzbek Consti-tution is not an exception. Its Preambledeclares the adherence of Uzbek people tohuman rights and democracy. Article 13states that democracy in Uzbekistan restson such ultimate values as life, freedom,honor and dignity of human beings. In-stituting the system of the checks and bal-ances, Article 11 provides for theseparation of power between the legisla-tive, executive and judicial authorities.

In practice, however, Uzbekistan is anauthoritarian country with a dismalhuman rights record. The Uzbek govern-ment persecutes human rights defenders,journalists, and others for exercising theirfundamental rights to freedom of expres-sion, press, assembly and conscience. Overthe past years, the Uzbek government ap-pears to have used fabricated charges to

imprison a number of dissidents. For ex-ample, Dilmurod Saidov, a prominent in-dependent journalist, was arrested on falseextortion charges and sentenced to 12and a half years following his extensive re-porting on farmer’s rights and local gov-ernment corruption in the city ofSamarkand. Similarly, Salijon Abdu-rakhmanov, also an independent journal-ist, was arrested on fabricated drugcharges sentenced to 10 years in prisonshortly after writing an article criticizingthe local traffic police.

Courts in Uzbekistan do not serve theirpurpose. Though the Constitution stipu-lates that judges are independent and thatit is prohibited to interfere in their ad-ministration of justice, Uzbeks have littlefaith in the independence of the judiciary.They perceive judges as biased and believethat prosecutors have total control overthe outcome of a case. Corruption hasalso undermined the judicial system, asUzbeks have little trust in defense lawyers,at times referring to them as “bribe medi-ators.” Akzam Turgunov is illustrative ofthe judiciaries failure to act as an inde-pendent and unbiased arbiter. Mr. Tur-gunov, a human rights activist andpolitical opposition leader, was arrested onextortion charges and sentenced to 10years in prison. Despite the fact that Mr.Turgunov was held incommunicado formore than two weeks, during which timean officer poured boiling water down hisback resulting in severe burns, the courtignored these flagrant violations of pro-cedural rights. Last November, the UNWorking Group on Arbitrary Detention(WGAD) found that Mr. Turgunov'scontinued imprisonment constituted ar-bitrary detention. WGAD came to thisconclusion because Mr. Turgunov’s de-tention resulted from his legitimatehuman rights activity and his trial failedto meet minimum international standardsof due process.

One would hope that Uzbekistan’s en-

gagement with the European Union(EU) would have had positive impact onthe overall improvement of the rule of lawand human rights in the country. Unfor-tunately, that was not the case. There areseveral documents that oblige the EU toengage Uzbekistan on the issues ofdemocracy, human rights and the rule oflaw. One of the major documents is Part-nership and Cooperation Agreement(PCA) between the EU and Uzbekistan.Another one is the EU Rule of Law Ini-tiative for Central Asia, adopted withinthe framework of EU-CA Strategy. Addto this the EU Representative CatherineAshton’s call to make human rights “a sil-ver thread” in the EU’s foreign relationsand newly adopted “EU Strategic Frame-work and Action Plan on Human Rightsand Democracy,” the EU’s engagementwith Uzbekistan on these issues has beenextremely trivial.

To translate the EU’s ideals into action,the EU should start with challenging theUzbek government about the sad state ofthe rule of law in the country. In the ab-sence of the rule of law, there can be nogenuine development in human rightsand democracy. Given courts are the pil-lars of the rule of law, the EU shall im-mediately embark on the reform of thejudiciary. It is through the decisions of in-dependent courts that constitutional pro-visions would acquire their significanceand protect individuals, especially humanrights activists and independent journal-ists, from being persecuted for their viewscritical of the government. The EU shallalso work more steadfastly on persuadingthe Uzbek government to free humanrights activists, independent journalistsand political activists, who were victims ofabsence of the rule of law in the country.

Nikki Sinclaire is a member of the Euro-pean Parliament's Human Rights sub-committee. She also sits on the Women'sRights and Gender Equality Committee.

By Nikki Sinclaire MEP

A man reacts as he looks for relatives amongst the dead who were killed during the unrest in the eastern Uzbek town of Andizhan on Saturday, 14 May 2005

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“You sell a kilogram of cocaine once but youdo sell a girl or a woman a hundred times.”Lydia Cacho learned this devastating truthduring her investigations into trafficking inher native country Mexico and around theworld.

The award-winning journalist and authortook part in a panel discussion at the TrustWomen Conference in London questioning‘How to put the trafficking business out ofbusiness?’

Tim Large, editor-in-chief of the ThomsonReuters Foundation, which co-hosted thetwo-day event with the International HeraldTribune (IHT), led the discussion.

According to the rights group Free theSlaves, as many as 27 million people areenslaved.

Despite national legislation acts and Article4 of the United Nations Declaration ofHuman Rights, which calls for the abolition ofslavery and the slave trade, there are moreslaves today than at any other time in history.

Women have become commodities,which are sold and re-sold again in this$32bn industry.

Compared to the combined budget of$125m available to the American non-profitsector, David Batstone, founder of the organi-sation Not for Sale, sees business as a majorplayer.

His organisation has created opportunitiesby developing social businesses to “fight busi-ness with business.”

In order to tackle malnutrition among sexworkers in the red light districts of Amster-dam, Not for Sale started producing heartysoups.

By aligning the economic with the socialstrategy, the project has turned into a holistic

catering business from growing its own ingre-dients to selling its final products throughglobal players.

Batstone believes that ‘match funding’ forsocial enterprise ventures is one solution in thefight to end human trafficking.

Another example how business can achievechange was put forward by Christopher Davisfrom The Body Shop International.

The beauty company has turned consumersinto activists with campaigns such as ‘Stop SexTrafficking’. Set up five years ago, it has led to“the largest petition in EU history on humanrights” with over 7 million signatures.

According to Davis, 22 governments havechanged their laws on human trafficking andhe believes “all business has that power.”

One of the concrete actions agreed on bythe conference participants was to free supplychains of trafficking and slavery.

“We need to develop corporate policiesagainst trafficking, provide workers with e-learning tools and promote best practises,” saidTracey Tully from the Asia-Pacific Network ofSex Workers.

Besides business support, lawyer Karen E.Silverman stressed the importance of pro bonolegal advice to victims of trafficking and forcedlabour.

The conference also called on all countriesto follow the Philippines, Uruguay and Mau-ritius to ratify the 2011 International LabourOrganisation (ILO) Convention on DecentWork for Domestic Workers.

On the European level, the “EU Strategytowards the eradication of trafficking inHuman Beings (2012-2016)" was launched tohelp combat the approximately 880.000 vic-tims of forced labour in the EU.

Christine Liehr covered the Trust WomenConference in London for New Europe.

HUMAN RIGHTS

Combatting human rights abuseBy Christine Liehr


ANALYSIS

A South African girl holds a poster during an anti Human Trafficking protest outside parliament in

Cape Town, South Africa. There has been a spate of recent cases where women have been lured into

trafficking syndicates by the offer of bogus fashion modeling contracts.

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Activists, politicians, entrepreneurs andjournalists from 28 countries gathered inLondon from 4-5 December for the TrustWomen Conference. Hosted by the Thomson Reuters Founda-tion and the International Herald Tribune(IHT), the global edition of the New YorkTimes, it was the first conference of its kindto examine how law can foster empower-ment. Monique Villa, chief executive of theThomson Reuters Foundation, opened theconference by outlining its theme of ‘puttingthe rule of law behind women’s rights’.Together with the IHT's publisher, StephenDunbar-Johnson, the conference aimed toinclude tough women’s issues like traffickingand corruption.”The event has been in the thinking forthree years and in the making for one year,”said Dunbar-Johnson. "It’s like the realisa-tion of a dream“.Far away from a dream are the statistics onforced marriage: around 25,000 girls underthe age of 18 are married worldwide eachday, according to Girls not Brides.Mabel van Oranje, who co-founded theglobal partnership, labelled it as a "perpetu-ator of poverty and gender inequality" slow-ing down the international community’s

efforts to achieve the eight Millennium De-velopment Goals (MDG) by 2015. The UN defines the term as "a marriagethat takes place without the free or validconsent of one or both of the partners andinvolves either physical or emotionalduress".Kevin Bales from Free the Slaves organisa-tion was among the few male participants.He listed religious, monetary (debt settle-ment) or cultural reasons driving forcedmarriage and urged to call it slavery - astatement met with applause from themainly female audience. Niger, Chad and Bangladesh top the list offorced marriage cases compiled by Girls notBrides. However, Europe’s backyards are notfree from the custom either. “This confer-ence is special as it also includes developedcountries”, said Dunbar-Johnson. In Britain alone, 8,000-10,000 cases offorced marriage and around 12 honourkillings are recorded each year. Chief CrownProsecutor Nazir Afzal said: “Prosecution isthe end, it means failure”. Still regarded as a women’s issue, he said:“We have to teach empathy and make menunderstand the moral and practical cost ofit.”The cost can be as high as death. “Muslim

women must become their own guardians,”said Ayaan Hirsi Ali from the AHA Foun-dation, in order to stop punishments in formof rape, genital mutilation and acid attacks.Each year, 5,000 honour killings are com-mitted and 1,500 acid attacks are carriedout worldwide of which 80% are women. Filmmaker Sharmeen Obaid Chinoy por-trayed four cases of forced marriage in herhome country Pakistan. Owing to financialand legal resources as well as broken tieswith their own families, women are forcedto move back in with their perpetrators.Many countries have legislation in place butthe law is ignored, interpreted wrongly or incountries with parallel legal systems re-placed by customary laws.According to Nobel Peace Prize LaureateShirin Ebadi, who spoke in her native Farsi,law has two main duties: its implementationcreates security and order, which in returnleads to a promotion of culture. She used the example of the gradual eradi-cation of polygamy in her country Iran todemonstrate how changes in legislation re-sult in a higher level of culture, and hencesociety.Model, filmmaker and campaigner ChristyTurlington Burns found that victims areaware of the law while shooting her docu-

mentary ‘No woman, no cry’. All of the girlsquickly changed their age to over 18 whenasked. “Law is a tool of change,” said EmmaBonino, Vice President of the Italian Senate,in her closing remarks. “Whatever achieve-ment, you finally get it written in stone, so itgets much more difficult to go backwards”.Mercy Chidi Ogbonna and Fiona Sampsonprovided a successful example of empower-ment through law in Kenya. By using thecountry’s Sexual Offence Act and the newconstitution from 2010, their ‘160 GirlsProject’ surpassed initial objectives to rescueover 270 girls from rape. The panellists agreed that laws need to beenforced and peer-to-peer work needs tostart from an early age for both girls andboys.The first International Day of the GirlChild (IDGC), held on 11 October, is anexample of more visibility to put the elimi-nation of child marriages on the politicalagenda.In the UK, forced marriage will become alegal offence as of 2013. The EuropeanCouncil ratified Convention CETS No.210, which will equip women with the rightto make an appeal to the Council and initi-ate a prosecution to reduce the number offorced marriages around the world. The fight may be far from over but thesesteps should provide women with a glim-mer of hope. CL

Law is empowerment

The EU’s austerity package was condemned byleading economist, James Galbraith, who alsohad harsh words for the Troika, currently over-seeing Greek finances.

Speaking at a conference organized by theEuropean Trades Union Institute, the econo-mist explained that his research into economicinequality had shown “that wage structureswhich were more egalitarian resulted in less un-employment.”

Galbraith explained that this result, whichwent against, in his father’s words, conventionalwisdom, but there appeared to be two reasonsbehind the finding.

Firstly, “inequality fosters migration.” He ar-gued that people would be motivated to moveto better themselves, affecting the labour poolremaining in a highly unequal nation.

Secondly, those places with less inequality, hediscovered, have higher productivity whichleads to higher standards of living, leading to agreater capacity to absorb unemployment.

Looking worldwide, he noted that as thefinancial sector became increasingly domi-nant, so did inequality rise and this wasclosely tied into credit cycles, the match be-tween income inequality and incomes was so

closely related to the stock market that “youcan see the state of inequality by watching thestock market ticker.” Pointing to the financialcrisis, he reminded the audience that it wasinitiated by mortgages that the lenders knewcould not be repaid. There were two types ofmortgage that caused problems; one wasthose given to low income families and the

other was on newly built houses, sold to peo-ple who could not afford them and defaultedon first payment.

These debts were piled up and sold on inwhat he called a ‘laundering operation’ by rat-ings agencies. These were bought up by peoplewho were distant, but trusted the agencies.

He also pointed out that those charged with

oversight were inactive and “the Justice depart-ment was asleep, deliberately so.” He added, “Inthe five years we’ve been discussing the crisis,fraud is the part that is talked about the leastalthough nobody denies it.”

“The new crackpottery” is how he describedthe advocates of small government and lowtaxes for the well off, also pushing austeritypackages.

Discussing the choice of austerity as a mech-anism to recover from the crisis, he wasscathing. “At this point, I cannot imagine it ispossible for any sane person to believe this,” hesaid. “Because if it was true, it would have hap-pened long ago.”

We’re dealing with a single, unified, interac-tive global investment community, not just ofprimary but also derivative instruments. Nomatter what country, no matter how obedientto the diktat of the Troika, you’re going to finda bit of bad news from anywhere in the worldis going to more people out of this class of as-sets at the same time,” he said, adding, “auster-ity leads to a decline in GDP which leads tohigher debts, with a higher debt to GDP ratioand public institutions are weaker, so you’re nolonger attractive to investors.”

“This is going to lead to destruction,” hewarned.

ECONOMY

Galbraith: ‘I cannot imagine how a sane person can believe in austerity’Leading economist slams austerity policies


ANALYSIS

When in Rome... James Kenneth Galbraith pictured against Rome's Vittoriano monument.

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The European Union should anticipate hav-ing a bigger role in foreign policy issues suchas peacekeeping, conflict resolution and post-conflict resolution, the Irish foreign ministerhas said.Speaking in Brussels on 10 December, theday the EU leaders were in Oslo to receivethe Nobel peace prize, Eamon Gilmore saidthat he is “expecting the EU to play a biggerrole in peace and security as its strengthensits foreign policy arm through the EuropeanExternal Action Service (EEAS).He was speaking as Ireland prepares to va-cate its year-long chairmanship of the Or-ganisation for Security and Co-operation inEurope (OSCE), which will be taken over byUkraine on 1 January. On that same date, Ire-land takes over the six-month presidency ofthe EU. In that role, he said, Ireland “wants tobring conflict resolution forward”, and im-prove EU capacities in the area.Moving from one mandate to the other hesaid that the country would “prioritise con-flict resolution” as one of its foreign policyaims. He said that the upcoming UkrainianOSCE chairmanship has also shown “seri-ousness and determination” in maintainingcontinuity and co-operation between theOSCE and EU.

Ongoing conflicts in the EU’s neighbour-hood region, in Armenia and Azebaijan,Georgia, and Moldova, add a certain amountof pressure and responsibility to Europeanpeace and security efforts. In the words ofGunnar Wiegand, the EEAS’ director forRussia, Eastern Partnership, Central Asia,Regional Co-operation and the OSCE, sta-bility in the region provides “a conducive en-vironment for economic interests”. Stabilitycan be achieved, he says, through existingframeworks, such as neighbourhood policyand the Eastern Partnership.For this, and other reasons, the Ukraine “fullysupports” European and Eurasian securitythrough existing frameworks, says AndriiDeshchytsia, special representative of the up-coming Ukrainian OSCE chairmanship onprotracted conflicts. As with the previouschairmanship, he believes that conflict reso-lution should be made a priority of EU for-eign policy.Also speaking on 10 December, he acknowl-edged that finding solutions to conflicts, suchas the current dispute between Georgia andRussia over the territory of South Ossetia orthe Nagorno-Karabakh dispute between Ar-menia and Azerbaijan, cannot be solved soreadily, but that Finding “new mechanismsand new approaches” is always possible.“It takes some time for new structures to

come about”, he said. “The OSCE has pro-vided the groundwork, but we really need theproactive role of the state that can influencethe processes”.“Who can play this role. The EU, US, Com-monwealth of Independent states or Russia?This very much depends on ambitions andattitudes”. He said that the EU is “the most

suitable” for this role.“No two conflicts are the same”, says EamonGilmore, “but there are often elements thatare the same; for example, national identity,religion or the outcome of terrorism. Thereare a number of qualities for conflict resolu-tion to start, and to be completed, but thebiggest one is patience”.

By Andy Carling

By Cillian Donnelly

SECURITY

EU should take ‘bigger role’ in peacekeeping

EU police officers and NATO peacekeepers use tear gas and stun grenades to disperse some hundreds

of Serbs who tried to prevent reconstruction of ethnic Albanian houses in the northern Serb-domi-

nated part of the ethically divided town of Mitrovica, Kosovo, 30 April 2009.

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On 13 December, the price of oil fell tonear $86 a barrel after budget negotiationsin Washington reached an apparent im-passe, signalling a slowdown in the USeconomy and lower oil demand. By earlyafternoon in Europe, benchmark oil forJanuary delivery was down 60 cents to$86.17 a barrel in electronic trading onthe New York Mercantile Exchange.

The contract finished 98 cents higher at$86.77 a barrel in New York on 12 De-cember after the US Federal Reserve an-nounced new stimulus measures to helpthe slow-growing US economy andthe Organization of Petroleum ExportingCountries (OPEC) held its oil output cei-ling intact.

On 13 December, Brent crude, used toprice international varieties of oil, wasdown 30 cents to $109.20 a barrel on theICE Futures exchange in London.

On 12 December, the Fed said it wouldbegin buying $45bn of Treasuries a monthfrom January, on top of the $40bn a monthin mortgage-backed bonds it started pur-chasing in September to keep the US reco-very on track. “The Fed at the moment willbe tapping their fingers on the table with ir-ritation looking at the politicians, waitingfor them to finally reach agreement over thedeficit and fiscal cliff,” Justin Urquhart Ste-wart, marketing director of Seven Inve-stment Management in London, told NewEurope on 11 December. “And as far as theFed is concerned they must feel so frustra-ted at the moment that they have done eve-rything possible. But the politicians stillaren’t acting properly so they will makewarm and cuddly noises to the markets, butthey will be glancing in an accusing man-ner at the American politicians for them tosolve their house up,” the London-basedanalyst added.

If US President Barack Obama gets bi-partisan agreement that will be extremelypositive and then the Fed will be more co-operative, he said.

Meanwhile, Europe is looking acrossthe Atlantic. “Europe needs America tobe steady in terms of fiscal cliff to see ifthey can get growth back on the agenda,”Urquhart Stewart said. “The encouragingthing I would suggest actually in Europeis that the flat-lining in the German eco-nomy over the confidence figures are upwill probably mean that Mrs Merkel willhave to have a more growth-focused po-licy - she has an election within the nextyear - and if she does that, that willchange the mood music for the rest ofEurope,” he added.

On 12 December, OPEC ministersagreed to leave their daily crude produc-tion target at 30mn barrels a day. Actual

output, however, is a million barrels hi-gher because some countries produceabove their limits. But they failed to reachconsensus on a new secretary general, apost sought by Saudi Arabia, Iran and re-surgent oil-power Iraq.

However, OPEC ministers, in particu-lar Saudi Arabia’s Oil Minister Ali al-Naimi, want Brent to average closer to$100 per barrel, Chris Weafer, chief stra-tegist at Moscow’s Sberbank InvestmentResearch, wrote in an e-mailed note to in-vestors on 10 December.

“The Saudis have been consistently tal-king about both the ample existing sup-ply and the dangers posed byhigher-for-longer oil prices to economicgrowth,” Weafer wrote. He reminded thatSaudi Arabia’s Oil Minister successfullytalked the price down from over $120 perbarrel to under $100 per barrel in the

spring against a backdrop of renewed glo-bal growth concerns.

Urquhart Stewart said that Riyadhneeds the global economy to keep ontrack. “The American economy is sho-wing some signs of recovery. Therefore,they all want and try make sure that reco-very continues,” he said.

Weafer explained that Saudi Arabia andmoderate producers within OPEC havetried to target $100 per barrel averageBrent because: Higher oil may slow theglobal economic recovery; higher oil in-creases the incentive for investment in al-ternative energy sources; a lower oil pricemay slow the pace of the currently fastproduction growth in Iraq and would alsoadd to the economic pressures on OPEC-member Iran.

“Saudi Arabia can balance its budget atclose to $100 per oil barrel and wouldmuch rather have price stability aroundthis level than see the risk of a big fall in2014 increase,” the Sberbank chief strate-gist wrote.

On 11 December, Andreas Andriano-poulos, former minister of Greece and di-rector of the Institute of Diplomacy andGlobal Affairs DEREE, told a Greece-NATO session on energy security inAthens that the risk premium is now fac-tored in the oil price, highlighted by therisk of a terrorist attack as well as con-cerns about Iran, Syria and Israel-Hamas.“The price you pay at the pump has littleto do with oil,” he said.

Urquhart Stewart told New Europethat the political risk premium has notgone away at all. “It probably has gone upin terms of what’s the next stage withSyria and the rest of the Middle East. Butall more reason therefore to try to givemore confidence to the rest of the globaleconomy rather necessarily falling back onpolitical unrest again,” he said.

On 12 December, Russian oil company Ros-neft finalised its agreement to buy 50%of TNK-BP from BP’s oligarch partners –Mikhail Fridman, German Khan, Viktor Vek-selberg and Lev Blavatnik. Rosneft will pay theoligarch consortium known as AAR $28bn incash for its 50% stake.

In late November, British oil major BP,which entered a profitable but troublesome

partnership with the tycoons in 2003, signed abinding agreement to sell its one-half stake inTNK-BP to Rosneft for $27bn in cash andRosneft stock.

Rosneft said it expected the transaction toclose by March after it had been approved byboth Russian and European anti-monopolybodies. Rosneft CEO Igor Sechin said he ex-pected the takeover to be "strategically attrac-

tive for the shareholders of Rosneft". "Theagreements reached put us in the position toimmediately begin preparing the integrationprocess," he added. "As we work towards clos-ing this transaction, I am confident that thisdeal benefits all stakeholders and is ultimatelygood for the future of the entire Russian oil andgas industry," Fridman said in a statement.

TNK-BP is owned by an investment vehicle

registered in the British Virgin Islands.Russian President Vladimir Putin has

blessed the deal, though he has said he hadmixed feelings about the takeover of a large pri-vate company by a state one.

Rosneft is now confronted with the task ofcombining the operations of two major pro-ducers while also implementing a raft of explo-ration deals concluded earlier with BP rivals.

ENERGY|BUSINESS

Rosneft finalises agreement with Russian oligarchs

ENERGY|OIL PRICES

Oil price weak on budget negotiations in WashingtonBy Kostis Geropoulos

ENI Chief Executive Officer Paolo Sca-roni said he discussed liquefied natural gas(LNG) exports with Mozambique Presi-dent Armando Guebuza following a majorgas discovery.

Scaroni talked with Guebuza in Maputoabout energy projects under way in the SouthAfrican country. "Among the issues discussedwere the future monetization of the gas re-sources via development of liquefied natural gas

export facilities, and the supply of gas for do-mestic power generation," ENI said.

Mozambique has estimated that theRovuma basin, home to the gas finds made byENI and Houston-based Anadarko, has 150trl

cubic feet of gas. ENI has 70% of the giant Mamba field

which it is looking to develop with Portugal'sGalp Energia, Korea's KOGAS and Mozam-bique's state-owned ENH.

ENERGY|LIQUIFIED NATURAL GAS

ENI discusses LNG exports in Mozambique


ENERGY & CLIMATE

Traders watch as Federal Reserve Chairman Ben Bernanke's press conference is broadcasted on the floor of the New

York Stock Exchange in New York City, 12 December 2012.

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On 12 December, EU Energy Commis-sioner Günther Oettinger raised the issueof common approaches to the construc-tion of Gazprom’s South Stream gaspipeline in a meeting with Russian En-ergy Minister Alexander Novak duringthe EU-Russia Permanent Council's ses-sion in Nicosia, the Commissioner’sspokeswoman, Marlene Holzner, toldNew Europe.

“The Russian side did not mentionSouth Stream. The Commissioner raisedit, saying that the EU Commission willcoordinate preparation for the EU side,”Holzner said. “The aim is that the projectis in line with EU environmental law andenergy legislation,” she added.

The EU said earlier that Russia haskept the EU in the dark about details ofthe South Stream project and thereforethe Commission cannot so far judge towhat extent South Stream complies withthe EU energy legislation.

In a joint press conference withCyprus Industry Minister Neoklis Sy-likiotis and Novak, following the Sev-enth Permanent Partnership Councilfor the Energy Relationship betweenthe EU and Russia, Oettinger said gasimports from Russia will actually in-crease in their significance. The Per-manent Council meeting took placeahead of the EU-Russia summit on 21December in Brussels.

The Commissioner said an importanttopic for EU-Russia energy partnershipis the infrastructure needs for storage andtransport of coal, oil and gas.

“We are trying to talk about how themaintenance and the further develop-ment of transport infrastructure shouldtake place. For example in the domain ofgas with Nord Stream and South Streamand the other pipelines that we have intothe individual market segments in theEuropean Union,” Oettinger said.

He said the EU and Russia are alsotalking about the further development ofmarket regulation. “We are exchangingopinions on how to apply these regula-tions. The European Union is very firmin continuing to develop the internal mar-ket for electricity and gas and to completeit by 2015. This is not only a challenge forthe European Union and its memberstates. But it also is a challenge for theRussian Federation and our suppliers forprimary energy so we are talking mainlyfor Gazprom here,” Oettinger said.

For his part, Novak said they discussedthe changes that are happening in theworld gas market, including the influenceof market reforms in the energy sectors ofthe EU and Russia.

Novak said the parties also discussedthe development of oil and gas infrastruc-ture. “We also agreed that next week wewill have a joint meeting with the regula-

tors, the representatives of the EuropeanCommission, the companies that are in-volved in the construction projects of in-frastructure in Europe to supply gas,including via the Nord Stream to talkabout the issues related to the implemen-tation of the Third Energy Package, pos-sible exemptions that can be consideredto give a go to these projects,” Novak said.

He acknowledged that Russia and theEU member states “are linked throughlong-term relations in the area of energythat allow us to resolve major goals foreconomic development of EU memberstates”.

Gazprom is facing a EuropeanCommission antitrust probe, which isseeking to determine whetherGazprom abused its dominance incentral and eastern European markets.Novak told the press conference theinvestigation against Gazprom was noton the Permanent Council’s agenda sothey didn’t discuss it.

Gazprom plans the Nord and SouthStream pipelines to bypass Ukraine. TheRussian gas giant conceived SouthStream after a pricing dispute withUkraine in 2007. After an even harsherdispute with Ukraine in 2009, which dis-rupted gas supplies to Europe, RussianPresident Vladimir Putin decided to ac-celerate South Stream. Meanwhile,Moscow hopes that Kiev would surren-der to Gazprom control of its gas pipelinetransit system.

Asked about the modernisation andupgrading of the Ukrainian transport sys-tem, Novak said this item was included inthe agenda. “We discussed it. My under-standing is that currently we have a con-tract between Gazprom and Naftogaz ofUkraine so accordingly if there is a need tomodernise the gas transport system ofUkraine the Russian side is ready to con-sider such suggestions. But we haven’t re-

ceived any so far,” Novak said.Konstantin Simonov, head of Russia's

National Energy Security Fund (NESF),told New Europe earlier that Ukraine wasthe main accelerator of South Stream.“Nabucco has no success so it’s not a realthreat for Gazprom. The main problemnow is what will be the situation withUkraine because if there will be noprogress in our negotiations with Ukraine,we will build four pipes – because SouthStream is four pipes,” he said.

On 7 December, Putin personally at-tended the launch of the construction ofthe first pipe of South Stream across theBlack Sea.

"South Stream will create the condi-tions for a reliable gas supply for the mainconsumers in southern Europe," Putinsaid at the symbolic first welding in thecoastal town of Anapa.

He also tried to put environmentalists’minds at ease. "This project, the same asNord Stream, will conform to the mostadvanced standards. We have thoroughlystudied the Black Sea area through whichthe pipeline will be laid. I can assure allthe participants in the project that it willmeet the highest environmental stan-dards," Putin said.

South Stream, bypassing Ukraine, willstretch over 2400km, traversing the BlackSea and will carry Russian gas via Serbia,Hungary and Slovenia to Northern Italy.

South Stream is seen as competition tothe EU-backed Nabucco pipeline, whichis supposed to pump gas from CentralAsia to Europe via Turkey and southernEurope, reducing Europe’s reliance onRussian gas.

In Anapa, apart from Putin, amongthose present at the ceremony were Bul-garia’s Regional Development and Pub-lic Works Minister Liliyana Pavlova aswell as representatives of Italy's ENI,France's EDF and Germany's BASF.


ENERGY & CLIMATE

The game isover forOPEC

On 12 December, OPEC agreed to retain its 30-millionbarrel-a-day output target and meet next on 31 May.But there was bickering among the Organization of Pe-troleum Export Countries' top three producers - Iraq,Saudi Arabia, and Iran. Many market observers pointout to an emerging new rivalry in the group, pitting up-and-coming Iraq against kingpin Saudi Arabia. Addingto the oil cartel’s problems is weak oil demand, the risein oil output from the United States, new shale tech-nologies and increased natural gas exports.ExxonMobil’s Outlook for Energy: A View to 2040,which was released on 11 December, points out that theglobal energy landscape will evolve significantly as re-gional demand-and-supply patterns shift in the com-ing decades.Fadel Gheit, a senior energy analyst at Oppenheimer inNew York, told New Europe on 13 December thatOPEC members cannot afford any discord. Energy de-mand will continue to be weak. “The days of 4% or 5%increase in demand are gone. They will be lucky to see1% or less year-over-year global demand growth,” hesaid, adding that this trend will continue because of in-novation, technology, conservation and environmentalpressure. He stressed that technology has opened upenormous resources and the shale revolution in the USand Canada will eventually spread throughout Europe,Asia and the rest of the world.Following the structural change in the energy mar-kets, the OPEC countries have to get back to a morerealistic expectation. “Oil prices are inflated. They arein no way supported by market fundamentals,” Gheitsaid. He noted that if it were not for the tension andspeculation, oil prices would be closer to $70 or evenlower. “There is no justification for $100 Brent or $85WTI,” Gheit said, adding that the OPEC countrieswill see their oil revenue decline over the years. “Oncethe new shale technology really spreads in Europe,the game is over for OPEC in my view. The game isover because all these countries will develop naturalgas,” he added. He pointed out to massive natural gaspotential discoveries in Cyprus, Israel, Mozambiqueand Australia.“I have a very dim view of OPEC. I really think thatthey have not kept up with the times and they will con-tinue to live backwards,” the Oppenheimer expert said.On 12 December, OPEC ministers failed to agree on anew secretary general and had asked Libya’s Abdalla el-Badri to stay in the post for another year. Gheit said itdoesn’t matter who the secretary general is because “atthe end of the day, Saudi Arabia is basically holding thekey - but how long nobody knows. Because I tell you,Saudi Arabia is not 100% immune to what is happen-ing in the region. There is tremendous anger, dislike,desperation against the regime”. Saudi Arabia report-edly needs an unprecedented $630 billion a year of oilrevenue to balance its budget. "That’s nonsense. All theyhave to do is to redistribute this wealth among people,”he said.Gheit pointed out to the corruption in Iraq. “They hadbillions of dollars heading in foreign bank accounts andthey’re bickering over all these things,” he said. “TheIranian situation is the same. It’s a corrupt country; it’sbasically the clergy controlling the country.”

[email protected] on twitter @energyinsider

By Kostis Geropoulos

ENERGY INSIDER

EU Energy Commissioner Günther Oettinger said that the EU and Russia are talking

about the further development of market regulation.

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ENERGY|EU-RUSSIA

Oettinger raises SouthStream issue with Russia

A new report has recommended that theBelgian authorities urgently address prob-lems of overcrowding and the failure tomaintain consistent standards for inmatesin the country’s prisons.

A report by the Council of Europe’sCommittee for the Prevention of Torture(CPT), published on 13 December, foundthat prison overcrowding has steadily wors-ened over the pat few years, and that condi-tions in certain establishments continue todeteriorate.

The report, based on a visit to Belgium bythe CPT in April 2012, calls on the au-thorities to address these issues, and alsocalls for dialogue aimed at establishing anew prisons policy in the country.

On a previous visit to Belgium, the com-mittee found examples of cells with no run-ning water or proper sanitary conditions. TheCPT also noted examples of prisoners sleep-ing on mattresses directly on the floor, as wellas a general lack of activities for inmates. Theratio of staff to inmates was also considered tobe too low, while concern was also expressedthat the waiting time for prisoners to receivevisits was considered too long.

The purpose of the latest visit “was to re-view the prevailing situation in the Belgianprison system, in particular the conditionsof detention in establishments for prisonersawaiting trial and issues connected to strikesby prison staff and other industrial actionresulting in a reduced work rate within pris-ons”. The visit in April took place immedi-ately following a spontaneous strike by

prison staff, and “the delegation observed inparticular the shortage of staff and the nu-merous restrictions imposed on prisonersduring the strike”. Poor conditions in pris-ons is the main reason for industrial actionby staff, which have serious consequencesfor inmates.

According to the report “systematic re-course to the police or civil defence teamsduring such strikes cannot be considered along-term solution to major problems

caused by industrial action. The Commit-tee therefore reiterated the recommendationwhich it made to the Belgian authorities in2005 that a ‘guaranteed service’ be intro-duced within prisons. This should be im-plemented without delay”.

The CPT also looked at the issue ofprison overcrowding, which has grownworse in recent years, according to the re-port. At Forest Prison, for example, 750prisoners were detained, despite the prison

having a capacity of 405 places. The CPTfound that “prison overcrowding implies notonly despicable conditions of detention,combining lack of privacy and violence, butit also deprives prisoners of certain funda-mental rights”. The committee recommends“that a national conference be organised, in-volving all interested parties, the objectiveof which would be to draw up the generalframework of a new criminal justice andprisons policy”.

PRISONS POLICY

Anti-torture body recommends overhaul of Belgian prisons

Greek Roma win human rights caseThe European Court of Human Rights(ECtHR) ruled on 12 December that theGreek authorities failed to integrate Romachildren into the ordinary education system. The applicants of the case Sampani and Oth-ers v Greece were 140 Greek nationals, all ofRoma origin, who complained to the courtthat they or their children had been enrolledat the 12th school primary school in As-propyrgos which was attended exclusively bychildren from their own community and pro-vided a lower standard of education thanother schools.In 2008, the 12th primary school was openedto replace an annexe to the 10th PrimarySchool which had been mainly attended byRoma children, and was supposed to admitRoma and non-Roma pupils alike. It was as-signed the same catchment area as the 9thand 10th schools.However, due to the worsened state of theschool facilities, which were damaged duringthe summer period, the ministry of educationasked the mayor of Aspropyrgos and the pre-

fect of West Attica to approve a merger of the12th and 11th schools. The prefect refused onsocial, cultural and educational grounds.The Greek Ombudsman then interfered stat-ing that the failure to implement presidentialdecree no. 201/1998 – by which all pupils liv-ing in a particular school’s catchment area hadto be transferred to that school, even if thishad not been requested by their parents – hadhad the effect of transforming the 12th schoolinto a “ghetto school”, since no non-Romapupils from the region were enrolled there.According to the ECtHR, there was a strongpresumption of discrimination against the ap-plicants on account of the placement of Romachildren in special classes in an annexe to the10th school’s main building, coupled with anumber of 'racist incidents provoked by theparents of non-Roma children'.In addition, the court held that Greece was topay €1 000 to each of the applicant familiesin respect of non-pecuniary damage and€2,000 to the applicants jointly in respect ofcosts and expenses. SG


ANALYSIS

Forest Prison,Brussels, Monday 23 April 2012 immediately prior to visit by the European Committee for the Prevention of Torture (CPT).

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The Italian MP and chair of the EPP groupin the Parliamentary Assembly of theCouncil of Europe (PACE), Luca Volontè,told New Europe that the post-monitoringdialogue with Bulgaria should be closed.The PACE Monitoring Committee votedon 12 December with a considerable ma-jority in favour of the continuation of thepost-monitoring dialogue with Bulgaria.The committee adopted a draft resolution,based on Volontè’s report, recommendingthat the Assembly votes on continuation ofthe dialogue during its next plenary sessionin Strasbourg (21-25 January 2013).Apart from welcoming the “substantialprogress” which Bulgaria has achieved so far,the resolution also emphasised a couple ofconcerns which required further reflectionsand had to be addressed. Among those wereindependence of the judiciary, fight againstcorruption and organised crime, independ-ence of the media and the rights of people

belonging to national minorities.In Volontè’s opinion, there was enough ev-idence from the past 12 years, showing thatBulgaria has the political will to address thenecessary concerns, and that it was “movingin the right direction”.Bulgaria has been under a post-monitoringdialogue since 2010, after the end of themonitoring dialogue. If the Assemblyadopts the resolution requiring the contin-uation of the current situation, the systemcan continue until the end of 2013 or thebeginning of 2014.In addition, the rapporteur said that he dis-agreed with the conclusion of the Monitor-ing Committee to continue the dialogue andsaid that he was going to present also in Jan-uary amendments to the draft resolution,proposing closure of the dialogue. He addedthat it was natural, seeing all the progress thecountry has achieved in the past years, toclose the post-monitoring. SG

Italian MP says post-monitoring dialogue with Bulgaria unnecessary

By Cillian Donnelly

Travelling to Venice Film Festival earlierthis year renowned film maker Ken Loachknown for his focus on the socio economicdaily existence of his characters, took sometime out to speak with Federico Grandessoof New Europe, the interview followsbelow.

What can the role of the film maker be, ifwe consider the present political and eco-nomic situation ?

I think we can do different things, but it

also depends if we are talking about film-

makers. Individual films they come and they

go, we can put a question in people’s mind

but to develop that you need a political

movement and the film itself can’t do any-

thing. On the other hand we can use these

occasions to show solidarity first of all with

people who are fighting against unemploy-

ment, for job security, against low wages.

We can also show solidarity with film-

makers who are denied expression like in

Iran and Palestine and we could refuse to go

to South Africa or Israel. When we were in-

vited to a festival in Iran, we didn’t go as

consequence of the personal restrictions

that the movie director Pahahi is suffering.

Today we see that the possibility of living

a decent life for a mass of people is very dif-

ficult but we also have hope. History is not

static and the thing will change but the cru-

cial question is how they are going to

change?

According to me hope belongs to people

who are working and not on the financial

transactions. In this context cinema is a

small voice in a big chorus of voices, there is

press, the propaganda of the big corpora-

tions, etc, and when I listen to somebody

like Clint Eastwood I’m quite glad that cin-

ema doesn't have too much power ( he

laughs ). Because if it was the case we would

all be carrying a gun like Charlton Heston.

Do you feel like a privileged movie di-rector? What’s about you next project?

Yes, I was really lucky in my life because I

could work with great actors, writes, pro-

ducers, camera people and editors, then I’m

shocked by the fact that I did my first film

nearly 50 years ago. In any case we have to

remember that because we are in a very

privileged position we also have be able to

raise our voice, like I’m doing now. I’m just

an ordinary person obviously if I was a doc-

tor I would be used to less publicity but we

have also to keep the sense of our own role

with humility. Then I’m actually working on

a documentary and maybe a movie of the

writer Paul Laverty.

You recently received an award by theCatholic church which you have also oftencriticised?

Not necessarily, but today we share com-

mon values then the church has many faces

sometimes it stands with the poor and the

oppressed and they had some moments in

its history when they supported fascism.

Today we are together supporting common

ideas.

European cinema is facing strong com-petition from the US and now also Asia.How can we support European produc-tions?

In the short term we need to have the

control of our screens, our European movies

are still having little impact because our cin-

emas are showing mainly American movies.

For example, if you live outside London you

will probably see very few films that are

shown during festivals like Venice. We have

to change this philosophy.

Europe is facing a big crisis who has animpact also in Asia, what can Europe do toget out of this situation ?

The first thing Europe can do is to get rid

of this set of politicians because they have

no answers, we need a new Europe that

could be based on common initiative, pop-

ular control, planed economy, human rights

and protection of the environment and then

we will be able to make progress. If we con-

tinue following the current ideas the eco-

nomic crisis will never end. Now they

managed to treat the illness but the disease

is much deeper, they just made cosmetic

changes.

As long that we are inside a free capital-

istic market the crisis will continue and all

the politicians all across Europe are largely

committed to make the market work but at

the end they have no answer. The answer

they have is to make labour cheap which

means more unemployment, low wages and

no job security and these theories will bring

us to a disaster.

This also means to use faster and faster

the world resources and this can not be the

answer.

The best thing they can is to take a long

trip with space traveller. We as civil society

on the other hand we can do a lot and or-

ganize ourselves in trade unions to fight

every wage cuts and every outsourcing; in-

dividually we are nothing but together we

can….you should join the trade unions. In

UK for example the leadership is often too

weak this mean that we generate a lot of

steam but with no engine to drive.

Would you like to do a movie about so-cial themes in Asia?

I don’t have the resources’ but I think that

it should be done by someone else. I don’t

know the culture and I’m also too old for

that.

VENICE FILM FESTIVAL INTERVIEW: KEN LOACH

Politics, the economy and film15NEW EUROPE

16 - 22 December, 2012INTERVIEW

Ken Loach earlier this year in Italy

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Two years ago, the European Commissionbegan an antitrust investigation into Google'sdominance in the online search and onlineadvertisement sectors. Since then, the numberof complainants against the search engineincreased, including mobile services andonline mapping.

A big number of mapping companies fromdifferent European countries, such as HotMaps, Euro-Cities, Streetmap and BottinCarto, presented a complaint to face Google'spower and have also participated in a reportissued by Initiative for a Competitive OnlineMarketplace (ICOMP), entitled �"HowGoogle Monopolised Online Mapping &Listings Services.”

While these firms are waiting for a conclu-sion from Commissioner Joaquin Almunia,Michael Weber, CEO of German onlinemapping company, Hot Maps, gave hisimpressions to New Europe about ICOMP'swhite paper and the present and future of thesector. “There have been many monopoliesbefore, from gas or petroleum, food or water”,Weber said. “But now we have this company(Google) that influences everyone in civilizedfirst and second world countries, and that isalso starting in the third world.”

According to him, Google is now the lead-ing opinion maker and controls both informa-tion and advertising. Besides, in the US thetech giant is also starting to influence on elec-tions' results, he explained.

From 2000 to 2005, firms had the challengeto show clients and users the need of onlinemapping and connections between the realworld and “the screen.” When Google decid-ed to launch its maps system “I was sure that

this would rise awareness that a map is some-thing you must have in your website”, Weberexplained, but it didn't happen “the way Iexpected.”

As the European Commission stated inMay, since 2007 Google is using its UniversalSearch tool to discriminate in favor of its ownmapping services and against its competitors,which are attracting fewer visitors and losingrevenues.

“Now we aren't making any money”, Weberexplained about Hot Maps. “Google gives thisservice for free to become dominant in themarket. And if this continues, only they will beleft in few years.”

He believes that authorities can break thispower with regulations that can “bring Google

back to common sense.” They can still lead themarket and by “being more ethical they willmake more money than with all these littletricks they are using”, he added.

Collaboration between the US and the EUis key to tackle Google's case. On 3 December,Joaquin Almunia and Jon Leibowitz, chair-man of the US Federal Trade Commission(FTC), gathered in Brussels to discuss andfind possible solutions.

People from Alumnia's cabinet, affirmedthat European regulators insisted that thesearch bias, or statistics, issue must beaddressed, even if the FTC chooses to back offthat element of its antitrust pursuit. Smallgroups of lawyers and lobbyists believe that thesearch engine has convinced Leibowitz to stop

enforcement actions.“The FTC will be listening on what the

Europeans say”, Weber told New Europe,adding that he doesn't believe that theAmerican body “is going to let Google off soeasy, just because it is trying to lobby them.”

Google is trying to confuse users by usingterms that mean something different, HotMaps CEO said. For instance, �"when theyuse “quality factor” in advertisement, what theyreally mean is pricing level.” According to this,they say that a page that has less “quality fac-tor” has to pay more for the same ad or is notgoing to be in the first page of search results.

To solve these kind of problems and stopthe damage, Joaquin Almunia is trying to finda quick solution. One person familiar with theissue, told New Europe that further Google'sinvestigations could take place, includingmobile services, and that if talks with the com-pany are not successful he will issue a state-ment of objections

In addition, this source also affirmed that “ifRomney would have won the presidentialelection, there would have been a pause to theGoogle case, due to re-staffing of top positionsin the FTC.”

Michael Weber also explained that onesolutions proposed by the complainants is toseparate each Google division and “put into anew company.” “In this case, only GoogleMaps would lose money and many thingswould change.”

"This is an historic fight, because if we losethings are going to get very controlled andbad”, Weber stated. “But Google has very fewfriends left in the industry, so my hope is veryhigh.”

Online mapping, another Google victimRegulation can bring the firm “back to common sense”, CEO Hot Maps says

Nearly 60% of Google Play andApple apps for kids share privateinformation with developers or thirdparties, most of them without par-ents' consent, a new study from USFederal Trade Commission (FTC)says.

“Our study shows that kids' appssiphon an alarming amount of infor-mation from mobile devices withoutdisclosing this fact to parents," saidFTC Chairman Jon Leibowitz.Besides, those app stores don't makethe practice clear in their privacystatement.

Despite some developers and appstores claiming that they're trying tomake their apps more "child-friend-ly", the FTC isn't content with thejob that's being done.

According to the study, 30% ofusers uninstalled an app that wasalready on their cell phone becausethey learned that the tool was col-lecting personal information theydidn't want to share.

The FTC urges the mobile appindustry to develop and implement“best practices” to protect privacy,including privacy by design, trans-parency and easy explanations aboutdata collection.

“These standards should be devel-oped expeditiously to ensure thatconsumers have confidence in thegrowing mobile apps marketplace”,

says the document.Some of the personal data shared

with advertisers included cell phonenumbers, geolocation and date ofbirth. All these data, allows adver-tisement firms to generate detailedprofiles of children as consumers.

The report also found that 58% ofthe 400 analysed apps, containedadvertising but only 15% of themdisclosed that fact to parents priorto downloading, and 22% had linksto social networks, but only 9%reported it.

No specific apps are named on thestudy, but the FTC affirms that 17%

of them allowed kids to make pur-chases, with prices ranging from 99cents to $29,99.

"All of the companies in themobile app space, especially thegatekeepers of the app stores, needto do a better job. We'll do anothersurvey in the future and we willexpect to see improvement,”Leibowitz stated.

In addition, non-public investiga-tions are taking place to find outwhether certain companies are vio-lating the Children's Online PrivacyProtection Act or the Federal TradeCommission Act.

By Nerea Rial

16NEW EUROPE16 - 22 December, 2012 TECHNOLOGY

Hot Maps is one of the complainants in the Google case | Hot Maps

60% of apps for kids share private information to third parties

The European Parliament approved on 11 Decemberthe unitary EU patent proposed and defended by theEuropean Patent Office (EPO) to cut costs for busi-ness and boost innovation.The project was passed after ministers from 25 MemberStates gave their support. The top legal officer of theEuropean Court of Justice (ECJ) recommended dis-missal of objections from Spain and Italy, which object-ed that their rights would suffer because the new patentswould be only in English, French and German.The new single patent system is intended to provide asimpler, cheaper and more effective system to manage60,000 patent applications a year across the EU terri-tory. It's expected to be implemented by 2014, withthe cost of filing patent applications falling progres-sively from around €30,000 to €5,000, according toECJ’s Advocate General, Yves Bot.“A single patent system will give innovative entrepre-neurs the platform to become major contributors tothe sustainable economic recovery of Europe”, saidJonathan Zuck, President of the Association forCompetitive Technology. He added that the new system “will not only offerSMEs more exposure to national markets, it will alsostandardise and harmonise Patent Law to give themlegal certainty; thereby protecting them from frag-mented national legislations.”As Benoit Battistelli, President of the EPO, explainedat the IP Summit in Brussels, currently, once aEuropean patent is granted it has to be validated ineach Member State. But, with the unitary patent sys-tem, inventors will have the possibility of chose aEuropean patent with individual territorial protection.From now on, SMEs will have a simpler system to reg-ister their innovations at significantly lower costs, stat-ed Zuck. “We need to remain vigilant that MemberStates encourage adoption and provide on-going sup-port for the new system.”

EU approves unitary patent FTC reveals lack of privacy on kids' apps17NEW EUROPE

16 - 22 December, 2012TECHNOLOGY

First city in Europe to have free Wi-Fi The Bulgarian city of Pazardzhik has theambitions of becoming the firstEuropean town offering free wirelessInternet to its citizens.

So far, 14 public places, includinglibraries and schools, have been chosen tooffer open access for wireless internetwithout a required password. The serviceproviders will be those to pay for theinternet in public places, whereas the costof internet in private places, such as barsand restaurants, will paid by the owners.

End users will have access to a freewireless connection. It is expected thatthe project’s implementation will start inthe beginning of next year.

The municipality claims that aftercompletion of the project, Pazardzhikwill be the first city in Europe to havefree Wi-Fi. Ryan Heath, spokesperson ofEuropean Commissioner for the DigitalAgenda, Neelie Kroes, said that theEuropean Commission welcomed allinnovations to get Bulgarians connectedto the Internet.

The Chinese ICT solutions providerannounced on 10 December its decisionto invest €70 million over a five-yearperiod to establish a research and devel-opment (R&D) centre in Helsinki,Finland.

Initial projects which will take place inthe new centre will focus on softwaredevelopment for smartphones, tabletsand rich-media devices. They will opti-mize users' experience of existing operat-ing systems such as Android andWindows Phone 8.

This new strategy will increase thenumber of its employees related withR&D worldwide to 70,000. Huaweiplans to recruit 30 employees for theFinnish centre, and expects to hire morethan 100 workers over five years. Thecompany currently employs more than7,000 people across Europe.

The Finnish centre “will play a globalleadership role in defining and imple-menting the Huawei user experience”,the company told New Europe.

"We believe the key to building ourbrand is to provide consumers with a reli-able and differentiated user experience”,said Kenneth Fredriksen, Vice-President,

Huawei Central, Eastern and NordicEurope. "The open and innovative envi-ronment in Finland is an ideal place forHuawei to strengthen our global R&Dcapabilities for devices, creating opportu-nities for both Huawei and the Finnishtelecommunications industry.”

New Europe asked the Chinese firmwhether any of the 30 engineers to behired are former Nokia workers, but theyexplained that their main interest is theFinnish ecosystem and that “when werecruit we always focus on the individualwork experience and how they can fitinto the Huawei innovation culture.”

Over the past 10 years, Huawei is try-ing to increase its presence and invest-ment in Europe, and is committed to fur-ther increase its actions in the region. InSeptember 2012, the firm announced a$2 billion investment in R&D, local pro-curement and centre of excellence initia-tives in the United Kingdom.

The Finnish centre will serve as one ofHuawei’s core centre for device R&D,along with one already established inSweden based on modem and technologydesign and another a user interfaceresearch centre in the United Kingdom.

After four failed attempts, North Korea(N. Korea) successfully launched asatellite into orbit on 12 December,showing off the improvement of itsweapons program, which Washingtonand its allies have strongly tried to stop.Despite the rocket will help track theweather and gather data, the UnitedStates, South Korea and Japan consid-ered it as a technology that could oneday deliver a nuclear warhead capable ofhitting targets as far away as the US.According to the United Nations reso-lutions, N. Korea is banned from devel-oping nuclear and missile-related tech-nology. However, several people expectthat Kim Jong-un, who took power ayear ago, will continue his father's "mil-itary first" programs.While the US defined the launch as"provocative" and a breach of UN rules,Japan's UN envoy called for a SecurityCouncil meeting. However, becauseChina, which is North's only major ally,will oppose to take strong sanctions,those will not take place. Analysts suggest that while the countryis celebrating the launch, it still has along way to go. "From past launches, weknew that North Korea has been able tobuild or buy working components for arocket”, wrote David Wright, co-direc-tor of the Union of ConcernedScientists.“The main difficulty is getting all theparts to work together and at the sametime, given the enormous complexity ofrockets”, he continued.Wright added that the region “has noconfidence in the reliability of the rock-et”, but affirmed that this event willchange the way other countries see N.Korea."A successful launch puts North Koreacloser to the capability to deploy aweaponised missile”, Denny Roy, asenior fellow at the East-West Centrein Hawaii, told Reuters.Besides, critics of the Obama adminis-

tration said that the launch should urgethe White House to rethink its strategyand give Pyongyang greater attention."The international community mustwork in a concerted fashion to sendNorth Korea a clear message that itsviolations of United Nations SecurityCouncil resolutions have conse-quences," the White House said in astatement.In the other hand, a North KoreanForeign Ministry spokesman reiteratedthat the rocket was a "peaceful project".

Huawei invests €70 million in Finland North Korea launches satellite, opens nuclear debate


AFP PHOTO / KCNA VIA KNS

18NEW EUROPE16 - 22 December, 2012 ARTS & CULTURE

In a couple of days we will all know if MelGibson was right and we’re all going todie in a planetary apocalypse. The lasttime we had our festive cheer spoiled wasin 2000, when pretty much the samebunch were predicting a lesser meltdownover the Y2k bug, which was going tobring about, so we were told, a global UNpolice dictatorship.

The Mayan belief system was a greatfascination for US author, William S. Bur-roughs, who wrote about Mayan gods inhis graphic book, ‘Ah Pook Is Here’. Thisventure started out in 1970 in a collabora-tion between Burroughs and the artistMalcolm McNeil, that was finally pub-lished in 1979 as just text and it wasn’tuntil 2008 that the text and graphics wereput on exhibition, after Burrough’s deathin 1997 and only published as the authorintended in 2010..

The book, strange even by his standards,is reasonably accessible, staying away fromhis earlier experimental novels where heused various methods, including the ‘cutup’ technique, that of physically rearrang-ing the text in an attempt to find a deepermeaning.

The tale is of a billionaire tycoon, John

Stanlel Hart, who discovers ancientMayan texts and uses them to further hisquest for immortality, by creating a ‘mediacontrol machine’ flashing images of fearand death, to fight off his own demise, butin doing so, he angers Ah Pook, theMayan god of destruction.

Taking the graphic novel idea to its lim-its, Philip Hunt turned the short story intoa 6 minute movie in 1994, using Burroughsas the narrator, the film is now on You Tube(http://tinyurl.com/ahpookishere) and haswon 10 international awards.

The UK Guardian newspaper said,"Phillip Hunt's gorgeous, grisly animationmates William Burroughs's gravelly nar-ration of Ah Pook The Destroyer's death-dealing parable with music by John Caleat his creepiest. Hunt's deliberate and dis-gusting illustrations of Burrough's mon-sters of the mind are a revelation;delicately articulated puppets riddled withrevolting detail. Turn down the lights, getout the headphones, and give yourself overto The Master's ghastly visions andsonorous warnings ("The world cannot becontrolled, except by accident") for sixgut-churning minutes."

Beat that Mel.

It’s hard to describe what Brian Eno isanymore. He’s been a reading recordingartist, an inventor of musical genres, anartist, diarist, cultural commentator and somany other things that the term ‘polymath’just seems too limiting. Eno is also concerned with how artistswork and find inspiration, which is not al-ways easy. All artists have felt the equiva-lent of ‘writer’s block’ and in looking forways out of his own creative blocks, Enocame up with an unusual solution, whichhad its influence in the East, using theprinciples of unconscious intuition andchance like those produced by the I Ching.Working with Peter Schmidt, an artistwho had produced artwork for some ofEno’s recordings, the pair developed ideasthat they had been working on, using shortsentences to create a set of 113 cards, eachwith an aphorism designed to shake up thecreative process.The set was called ‘Oblique Strategies:Over one hundred worthwhile dilemmas,’and the artists explained their intentions. “These cards evolved from our separateobservations on the principles underlyingwhat we were doing. Sometimes they wererecognized in retrospect (intellect catchingup with intuition), sometimes they wereidentified as they were happening, some-times they were formulated.“They can be used as a pack (a set of pos-sibilities being continuously reviewed inthe mind) or by drawing a single card fromthe shuffled pack when a dilemma occursin a working situation. In this case,the cardis trusted even if its appropriateness isquite unclear. They are not final, as newideas will present themselves, and otherswill become self-evident.”Eno also explained their importance, “TheOblique Strategies evolved from me beingin a number of working situations whenthe panic of the situation - particularly instudios - tended to make me quickly forgetthat there were others ways of working and

that there were tangential ways of attack-ing problems that were in many sensesmore interesting than the direct head-onapproach.”The suggestions on the cards include, ‘Ho-nour thy error as a hidden intention’ ‘Statethe problem in words as clearly as possible’and so on.Schmidt died in 1980 and Eno stoppedworking on the cards. This led to them be-coming collector’s item and their cult sta-tus grew. So did the price.In 2010, Eno revisited the cards and de-veloped a new edition, now on sale for €37. Since the early editions technology hasmoved ahead and so has Eno. The cardsare now available as a free app, for Appleand Android phones, so we can all useoblique strategies whenever inspirationneeds a nudge.Famous users of the card include USgroup, REM, who used one of the cards,‘Withdrawing in disgust is not the samething as apathy’ in their hit What’s theFrequency, Kenneth, and UK coolsters,Coldplay.

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19NEW EUROPE16 - 22 December, 2012ARTS & CULTURE

The UK-based dub poet, Linton KwesiJohnson has been awarded this year’sGolden PEN award.

The award, by the English division ofthe prestigious worldwide association ofPoets, Essayists and Novelists (PEN), isawarded annually to “a writer whose workhas given both pleasure to readers and in-spiration to their fellow writers”. Previ-ous recipients of the wars include SalmanRushdie (2010), JG Ballard (2008), andNobel prize winners Doris Lessing(2007) and Harold Pinter (2001).

Johnson (LKJ) was born in Jamaica in1952, and moved to the UK in 1963.While still at secondary school, he joinedthe British Black Panther Movement,

and helped organised poetry workshopsfor its members. In the mid 1970s, hiswork appeared regularly in the journalRace Today, and in 1974, his first collec-tion of poetry was published, Voices ofthe Living and the Dead.

His second collection, Dread Beat an’Blood, was issued the following year, andwas later released as a recorded album,with music written by Johnson and per-formed by a band led by producer andmusician Dennis Bovell. Over the nextfew years, Johnson would release a seriesof key albums, all produced with Bovell,Forces of Victory (1979), Bass Culture(1980) and Making History (1983). Thetwo continue to collaborate to this day.

Johnson’s poetry is often highly politi-cally-charged, chronicling the black ex-perience in Britain, and often concernedwith matters such as racism and policebrutality in poems such as Sonny’s Let-tah, Fite Dem Back, Reggae Fi Peach,Inglan is a Bitch and the chilling NewCrass Massahkah.

In 2002 he became only the secondBlack poet, and one of only three livingpoets to be included in the PenguinModern Classics series.

In 2005, he was awarded a MusgraveMedal from the Institute of Jamaica forhis “distinguished eminence in the fieldof poetry”.

CD

In 1948 the Empire Windrush docked atTilbury, London carrying on board 493 mi-grants from Jamaica looking for a new life inpost-war Britain. In one of life’s ironies, theship had previously been used as a cruise shipfor high ranked members of the German Naziparty pre-war.The ship’s arrival marked the beginning of theBritish African-Caribbean community and isseen as an important event in British history,most recently being incorporated into the stun-ning and acclaimed opening ceremony of theLondon Olympic Games last year. These hum-ble beginnings produced some of Britain’s medalwinners and, of course, Jamaica also sent UsainBolt, who won the hearts of the spectators.There were other people onboard the Win-drush, who began a tradition that enriched thecultural life of the UK, calypso musicians, LordKitchener and Lord Beginner. Their popular-ity grew from the immigrant communities,centred around Brixton and found wider fame

in 1950 when Kitchener wrote and Beginnerrecorded ‘Cricket, Lovely Cricket’ that is cred-ited in helping the West Indies beat the Eng-lish at Lords.Calypso was but one style, others followed in-cluding ska, the forerunner to reggae.Desmond Decker’s Israelites, Millie Small’sMy Boy Lollipop are just two that gained chartsuccess and became classics.The British community from the West Indiesalso broadened Jamaican influences as ska starsmade the long journey to tour the UK until thebig breakthrough in 1973 when Bob Marleyand the Wailers released their first album,Catch A Fire on Island records, a labelfounded in Jamaica by an Englishman, ChrisBlackwell, who first encountered the Rastafar-ians in 1958, when a sailing accident left himswimming to a barren shore. He was rescuedby the religious group and they nursed himback to health.The music business is not known for trustedrelationships between labels and performers,but Blackwell and Marley had a long relation-

ship, despite never having a signed contract be-tween them.A new breed of UK reggae acts blossomedunder the popularity Marley brought in the70s, with people like Dennis Bovell’s Matumbi,Aswad and more getting off the ground, but itwas two events in 1976 that turned everythingup a notch.In the late summer, Eric Clapton interruptedhis set with a drunken rant that was shockinglyracist, especially from someone who made acareer out of the blues, in response an organi-zation, Rock Against Racism was formed andquickly taken up by the new punk movement.Clapton’s racism was swiftly countered byBirmingham’s Steel Pulse and their hit, KuKlux Klan and Linton Kwesi Johnson’s DreadInna Inglan, the first of many fiery recordings.Sharing an outsider status, many punk bandsshared stages with the British reggae acts andthis mix also influenced many acts like TheClash, whose finest moment, White Man InHammersmith Palais is a blistering mix of thetwo genres, marking a night out watching Ja-

maican bands performing at the legendaryLondon venue. Other bands, like The Rutsalso had a heavy dub influence, sometimes re-leasing dub versions of songs or entire albums.There were many other reggae bands, includ-ing Misty In Roots who can claim to havemade the finest live reggae album ever recordedin Brussels, Live At The Counter-Eurovision,in 1979.At the same town, the inner cities of the onceindustrial Midlands produced a ska revival,with mixed race bands like The Specials, TheBeat and London’s Madness becoming part ofthe record label Two-tone, who had a lengthystring of hits, producing great music often witha hard political edge, such as The Beat’s pleato then PM Thatcher, Stand Down Margret,but the peak was the 1981 song, Ghost Townthat summed up an era.The journey of West Indies music, from Win-drush to becoming a central part of today’smusic scene, shows that multiculturalism is nota problem but a proud part of both heritagesthat has enriched us all.

Golden PEN for dub poet

MUSIC

Windrush: The musical legacy

By Andy Carling

Collin

Pate

rson 2

007

Passengers from Empire Windrush arrive in London A special record

20NEW EUROPE16 - 22 December, 2012 ARTS & CULTURE

17-26 January 2013Warehouse Studio Theatre, Schaerbeek

Over the course of one weekend, thelives of a well-to-do couple come underattack by family members and friends. El-egant and entertaining, this PulitzerPrize-winning play beguiles its audienceinto an icy wasteland of the humanheart…

It premiered in 1966 and won thePulitzer Prize for Drama in 1967, the firstof three he received for his work. Aftertwelve previews, the original Broadwayproduction, directed by Alan Schneider,opened at the Martin Beck Theatre onSeptember 22, 1966 and ran for 132 per-formances. The cast included HumeCronyn as Tobias, Jessica Tandy as Agnes,Rosemary Murphy as Claire, HendersonForsythe as Harry, Carmen Mathews asEdna, and Marian Seldes as Julia. It wasnominated for the Tony Award for BestPlay.

After 27 previews, a revival produced byLincoln Center Theater at the PlymouthTheatre, opened on April 21, 1996 and

ran for 185 performances. It was directed by Gerald Gutierrez and

starred Rosemary Harris as Agnes,George Grizzard as Tobias, John Carter asHarry, Elizabeth Wilson as Edna, ElaineStritch as Claire, and Mary Beth Hurt asJulia.

The production won the Tony Awardfor Best Revival of a Play as well as TonyAwards for Grizzard and Gutierrez, andthe Drama Desk Award for OutstandingRevival of a Play.

A 1973 film adaptation was directed byTony Richardson for the short-livedAmerican Film Theater series. It starredKatharine Hepburn, Paul Scofield, LeeRemick, Joseph Cotten and Kate Reid.

A London production of the play pre-viewed at the Theatre Royal Haymarketfrom October 15, 1997, opened on Octo-ber 21, 1997 and closed on April 4, 1998.A 2011 revival of the play was presentedat the Almeida Theatre in Islington, Lon-don, directed by James Macdonald. Thecast included Lucy Cohu ( Julia), DianaHardcastle (Edna), Ian McElhinney(Harry), Tim Pigott-Smith (Tobias),

Imelda Staunton (Claire) and PenelopeWilton (Agnes).

In 2013 Brussels gets a fair turn withthe American Theatre Company puttingon a much anticipated show.

A Delicate Balance, by Edward Albee. Di-rected by John Stanton, starring JenniferBaker, Andy Blumenthal, Sigrid Van Eepoel,Carrie Ellwanger, Peter Brooke and OonaghGannon.

Isabelle Huppert reads Sade. A worldcreation in the Centre for Fine Arts.BOZAR | Henry Le Boeuf Hall 27JanuaryIn this world premiere, Isabelle Huppertplays two emblematic characters createdby Sade: Justine and Juliette, two sisterswith radically different fates, one wholoses out because of virtue, the other tri-umphing thanks to vice. Through them, Raphael Enthoven looksat the uneasiness provoked by the de-monic author's writings and message: "Icannot figure out why it is that the Mar-quis de Sade continues - legitimately -to shock us. … His hymn of praise to

vice and the excesses of the orgies he de-scribes are not enough to explain thepersistence of the disgust he inspires.The problem goes deeper than that. Sadeis the dark side of the Enlightenment,the hidden side of the sun. His immoralism is, in the first place, anamoralism. Underlying the imprecationsof the infidel against the "divinechimera", we must hear the refusal to be-lieve that the world is there to please us.Perhaps this is what makes him indi-gestible: the consistency with which heconstructs a philosophy - and even a sys-tem of ethics - on the basis of a worldthat is glacial and inhuman."

A Delicate Balance

Isabelle Huppert © Peter Lindbergh

Le viceet lavertu

21NEW EUROPE16 - 22 December, 2012BRUSSELS AGENDA

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www.arsene50.be

Ticket sale: - At BIP, 2-4 rue Royale (Place Royale) 1000 BruxellesTuesday to Saturday, from 12.30 pm to 5.30 pm- Online on www.arsene50.beTuesday to Saturday, from 2 pm to 5.30 pm

RESTO BITESEccetera402 Ch.de Wavre, Brussels, Tel 02 514 4995, www.eccetera.comTucked just off Place Jordan close to the bustling EU quarter is thisreal gem of a restaurant. The food, which heavily features truffle im-ported from Italy as well as lovely pasta dishes, is wonderful but so tooare the little touches that set it apart from many other eating estab-lishments in the city. For example, you don’t get a conventional menuhere but, rather, choose your dish from the wide selection printed onthe walls. The pasta (and wines) that adorn the shelves surroundingyou are not there merely for decoration but to stock produce all ofwhich is used in the kitchen. There are three types of menu: classic,regular and the range of specials which change every ten days. Every-thing is freshly cooked and the deserts are homemade. Also differ-ent is the way the house wine is served – you pay according to theamount you drink which is measured on the bottle.If you don't wantto finish the bottle you simply pay for what you have consumed.Another innovative touch is the very talented pianist (Xavier Locus)who plays every Saturday night. Actually,he almost steals the showbut it all makes for a great night out. This is a very cool place and eventhe restaurant’s website is different to most others. Aurelio Giglio,the friendly Italian-born owner and head chef, opened the place al-most two years ago and it’s rightly proved a big success. He also runsanother nearby restaurant and, ably assisted by the Eccetera team,Anna Dufeil and Stephane Peeters, is making a real name for him-self. Open every lunch and from 6.30-10pm (closed Saturday lunch).Highly recommended.

Fancy catching a glimpse of one of this country’s finestyoung musical talents ?If so, you can catch pianist Florian Noack, from Brainel'Alleud, in concert at the city’s Palais des Beaux-arts on 18December.He will occupy the soloist spot in a concert featuring themusic of Bach, Mozart and Charpentier.Noack, who is still only 22, will be candidate at the pres-tigious International Piano Queen Elisabeth Competi-tion 2013 in Brussels. Winners from this event normallygo on to enjoy glittering musical careers.The concert, starting at 8pm, is entitled Mysterium 2012and is being organised by MusikAnima.Apart from showcasing such a wonderful young talent,

the concert is designed to help raise funds for the so-calledONG project in Bolivia and other developing countries.Some of the proceeds will go towards providing improvedhealthcare in such nations and also giving the local pop-

FirestarterGreat Mountain Fire – unplugged21 December, Cirque RoyalPerhaps the finest indie band from Brussels, GMFwere formed in 2006, producing razor sharp popsongs. In 2010 they recorded their first album,Canopy, described a “a record of intrigue and sub-stance, whose fine concoction of generic beats andpop simplicity will leave the Goth dancing and thesailor crying!” After building on their reputation asa terrific live band, boosted by excellent perform-ances at many outdoor festivals, the band return toCircue Royal for something different. This will bea unique performance, an unplugged performanceof their debut album, the band say that the brassand srting sections have already been booked, so it’sgoing to be a great pre-Xmas treat.

Shepherd songsChoral concert17:00, 21 December, Grand PlaceIf this doesn’t bring the Christmas spirit into the centre ofthe city, then nothing will. The magnificent Grand Placeis hosting a free concert by Les Pastoureaux (The Shep-erd boys), a choir from Waterloo, formed in 1974, to “offersome pleasure to those who were alone, in hospital orhomes, or to those who felt particularly lonely during thattime of year when most people celebrate with their fami-lies.” Come and enjoy the finest Belgian voices in the finestsurroundings. Starting at 5pm, there will be three parts totheir concert, each of 20 to 25 minutes, with two short in-ternissions. If you’re lucky, you might get a great view fromthe Electrabel Xmas ‘tree’, with the added benefit of notlooking at the monstrosity if you’re on it!

ulation the means to determine their own destinies.Organised by the organisation, Louvain Cooperation, the concert will,it is hoped, also generate funds to go towards the fight against hunger,malnutrition and disease in the sub-continent. Tickets range in price from 20 to 30 euros though there are reductionsfor people aged 16 and under. The concert is also staged at the Colle-giale Sainte Gertrude in Nivelles at 8pm on 21 December.Further details are available from : [email protected]; tel : 047004 07 46 or via www.musikanima.com

FINLAND | BUSINESS

Ascent Elevators go to KONE Finnish elevator and escalator company KONE has ac-quired the San Francisco-based business of Ascent Eleva-tor Services, it was reported on 10 December. Ascent is anindependent elevator company with a significant share ofthe service market in the San Francisco Bay Area. It hasoperated in the San Francisco market since 2004. Ascentand KONE will combine elevator operations under theKONE name during the next few months. “We are thrilledto be adding great new customers in the very important SanFrancisco market, said Larry Wash, Kone EVP and AreaDirector for the Americas. KONE is one of the global lead-ers in the elevator and escalator industry. The company hasbeen committed to understanding the needs of its cus-tomers for the past century, providing industry-leading el-evators, escalators and automatic building doors as well asinnovative solutions for modernization and maintenance.In 2011, KONE had annual net sales of €5.2 billion andon average 35,000 employees.

GERMANY | PHARMACEUTICALS

BASF opens world-scaleproduction site in BahrainOn 13 December, BASF was to open a state-of-the-art pro-duction site for customer specific antioxidant blends (CSB)in the Kingdom of Bahrain. This is the largest facility of thiskind worldwide and will become fully operational in De-cember, The Company reported. With this investmentBASF Plastic Additives continues to strengthen its positionas the leading partner in plastic additives for the plastic pro-cessing industry worldwide and shows its strong commit-ment to support the growth of the polymer industry in theGulf Corporation Council (GCC). CSB are additives-blends individually tailored to meet individual customerneeds and are an integral part of the portfolio BASF offersto the plastics industry. Kamal bin Ahmed, Minister ofTransportation and Acting Chief Executive of the BahrainEconomic Development Board, said: “We are delighted towelcome BASF, a leading international company, to Bahrain.Large manufacturing firms like BASF are playing an in-creasingly important role in our economy and will be a sig-nificant part of our plan to create sustainable long termeconomic growth and high quality jobs.” The new facility,which is based on proprietary CSB technology, will providelocal production and services to the fast growing polymermarket in the Middle East with special focus on key cus-tomers in the countries of the GCC. The new facility is partof a strong antioxidants production network comprisingAsia, Europe and the Americas, which will be further opti-mized once the new capacity comes on stream.

FINLAND | MARITIME INDUSTRY

Wartsila wins order for LNG ferryFinnish manufacturer Wartsila, the marine industry’sleading solutions and services provider, has been awardedthe contract to supply the gas powered propulsion ma-chinery and corresponding gas storage and handling sys-tems for a new passenger ferry, it was reported on 11December. The boat, ordered by Societe des traversiersdu Quebec (STQ), will be used on routes crossing the StLawrence River. The vessel will use Wartsila 34 dual-fuelgenerating sets, which can reduce nitrogen oxide emis-sions to 85% below current International Maritime Or-ganisation (IMO) limits, cutcarbon dioxide emissions bya quarter compared with conventional diesel fuel engines,and reduce sulphur oxide and particle emissions to closeto zero. The Wartsila equipment is due to be delivered inthe autumn 2013, and the vessel is scheduled for deliveryby the end of 2014. Italian shipbuilder FincantieriCantieri Navali Italiani is building the vessel.


EUROPEAN UNION

A landmark Swiss-German tax deal cov-ering Germans who have sought tododge tax by hiding assets in Swiss bankaccounts has finally collapsed in the Ger-man parliament, The Local; reported on13 December.

The deal was thrown out late lastWednesday because it was judged too le-nient for tax evaders.

Under the terms of the deal, whichwould have come into effect on 1 January,Germans who have parked undeclaredassets in Swiss bank accounts would havebeen able to regularise their holdingswhile retaining their anonymity.

The deal negotiated by Berlin andBern would have resulted in Swiss banksdeducting taxes from German clients andtransferring the tax revenues to Berlin, al-lowing the clients to remain anonymous.

But the deal had to be ratified by bothparliaments and while the lower house orBundestag approved it, it was rejected bythe upper house or Bundesrat in Novem-ber. Members of the opposition SocialDemocrats and Greens in the Bundesratargued the deal was too soft on tax-dodgers.

The government subsequently tried tosave the deal by putting it to a mediation

committee made up of members of boththe Bundestag and the Bundesrat.

However, the committee voted againstthe deal late last Wednesday.

Switzerland expressed disappointmentat the collapse of the agreement.

Berlin and Bern have been embroiledin a spat over tax since 2010 when Ger-man authorities raided branches of Credit

Suisse bank in 13German cities afterbuying data on suspected tax frauds.

Switzerland reacted angrily, saying thedata were stolen in violation of its bank-ing secrecy laws.

As much as €180 billion ($222 billion)in German assets are hidden in Switzer-land, according to unconfirmed media re-ports.

Swiss-German tax deal finallycollapses in Germany

GERMANY|FISCAL TREATY

$57 mln pledged for ODA to VietnamDENMARK|ASIAN AFFAIRS

Denmark will provide Vietnam with$57 million in official development as-sistance (ODA) in 2013. Danish Am-bassador John Nielsen announced at apress briefing on 7 December, ScandAsia reported last Tuesday.

Nielsen said the aid aims to helpVietnam build a sustainable greeneconomy. The potential for technicalcooperation between the two countriesis great, especially in the energy field,he added.

Under bilateral agreements on greengrowth, energy saving, and climatechange adaptation, Denmark will offeran additional $14 million to assist

Vietnamese small and medium-sizedenterprises (SMEs) to improve energyefficiency, reported VietNamNetBridge.

A tripartite green growth agreementsigned by Vietnam, Denmark, and theRepublic of Korea also focuses onhelping the Southeast Asian countrydevise a green growth strategy.

The Danish Ambassador pledged toprioritise assisting Vietnam’s effortswith legal reform, administrative re-form, and capacity building for theNational Assembly’s agencies.

Vietnam-Denmark relations havesteadily advanced over recent years. In

November 2012, Danish Prime Min-ister Helle Thorning Schmidt visitedVietnam, aiming to boost bilateral co-operation in various fields, especiallypolitics, trade, and culture.

Denmark is one of Vietnam’s lead-ing EU partners in terms of ODAprovision. Since the 1972 establish-ment of the two countries’ diplomaticties, Denmark has granted more thanUS$1 billion in ODA to Vietnam.Most of it has been allocated to infra-structure development, poverty reduc-tion, administrative reform,environmental protection, SME assis-tance, and climate change adaptation.

$8.3 mln aid to the Mekong Environment ProgramSWEDEN|ASIAN AFFAIRS

On 7 December, 2012, the SwedishAmbassador to Thailand, Klas Molin,signed on behalf of the Governmentof Sweden a co-financing agreementof $8.3 million for a second phase ofthe Core Environment Program andBiodiversity Conservation CorridorsInitiative (CEP-BCI), an Asian De-velopment Bank (ADB) administeredprogram helping the Greater MekongSubregion (GMS) achieve environ-mentally-friendly economic growth,Scand Asia reported last Tuesday.

Sweden’s latest commitment followsthe $11 million it contributed to the2006-2012 pilot phase of the CEP-BCI.

The program is helping GMS coun-tries shift towards green economies, in-cluding support for biodiversityconservation and climate change adapta-tion and resilience.

CEP-BCI is part of the GMS Eco-nomic Cooperation Program, which hassince 1992 invested more than $15 bil-lion in sub-regional roads, airports, rail-ways, power facilities, tourism

infrastructure, and disease prevention. InOctober this year, Sweden committed$7.5 million to the Core AgricultureSupport Program, another initiativeunder the GMS Program.

CEP-BCI is overseen by the GMSWorking Group on Environment,consisting of representatives from theenvironment ministries of the sixGMS countries: Cambodia, People’sRepublic of China, Lao People’sDemocratic Republic, Myanmar,Thailand, and Viet Nam.

Picture taken on February 4, 2010 shows the Swiss flag fluttering on the Swiss embassy as the German

flag can be seen on the Reichstag building housing the lower house of parliament in Berlin. German

lawmakers in the upper house of parliament rejected on November 23, 2012 a deal on the taxation of

German assets parked in Swiss bank accounts.

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IRELAND | ECONOMY

Tesco to pay Aldi €150,000in damagesSupermarket chain Tesco has agreed not to engage in mis-leading price comparisons with its rivals Aldi, Breaking Newsreported on 7 December. Tesco Ireland is also to pay € 150,000damages to Aldi as part of a legal settlement between the twostores. Aldi is to donate the money to the St Vincent De Paul.The chain alleged Tesco has been misleading customers in itsin store campaign by failing to compare like with like. For ex-ample Tesco's non-vintage claret at €4 was contrasted withAldi's vintage claret at €4.99. Aldi sued the supermarket giantfor alleged trademark infringement but the case has been set-tled ahead of an eight day hearing which was scheduled fornext week. Tesco has agreed to pay Aldi €150,000 and hasgiven undertakings not to engage in misleading comparativeadvertising having regard to a whole host of criteria such asthe quality, nature and origin of a product. A statement fromAldi read: "Aldi is very pleased with the undertakings given tothe Court today by Tesco in relation to its inaccurate advertis-ing campaign with respect to Aldi’s products."

AUSTRIA | AVIATION

AUA to axe another 150 jobsAustrian Airlines are planning to axe another 150 jobs fromground staff with plans to eliminate doubling up that cur-rently exists in some areas, Austrian Independent reportedon 12 December. The company currently has 6,320 staffand the axing of 150 jobs will bring a saving of around €10million a year. AUA-boss Jaan Albrecht said that the toughmarket conditions currently meant they had no choice. Hesaid that they had been aware for years about organisationaldoubling up and it was now the time to do somethingabout it. Tyrolean Airways-boss Gaudenz Ambühl said ithad been a very painful decision, but it was vital to makesavings as part of the current restructuring process.

The General Court of the EuropeanUnion today issued a ruling, uphold-ing the fine of €20 million the Com-mission imposed on Electrabel forhaving put a concentration into effectbefore notifying it.

The Belgian company Electrabel is in-volved in the fields of electricity and nat-ural gas and has been part of the Gaz deFrance (GDF) Suez group since 2008. In2003, Electrabel was holding to 49.94%of Compagnie nationale de Rhône’s(CNR) capital, which is another electric-ity producer, and 47.92% of its votingrights. In 2007, the company contactedthe Commission, seeking its opinion,under EU law on concentrations, as towhether it had acquired de facto sole con-trol of CNR.

The Commission did not oppose theconcentration and declared it compatiblewith the common market. However, ithas decided to impose a fine of 20 mil-lion euros on Electrabel, for acquiringcontrol of CNR, without having receivedprior approval under the EU MergerRegulation.

The Commission concluded that theinfringement lasted for a significant pe-riod (2003-2007) and that Electrabel

should have been aware of its obligationto receive Commission approval beforeproceeding with the acquisition. Conse-quently, Electrabel brought the case be-fore the General Court asking forannulment or reduction of the fine.

Last wee on 12 December the Gen-eral Court of the European Union re-jected all arguments put forward byElectrabel and therefore decided todismiss the action and uphold the fineof €20 million since the amount is ap-

propriate in the circumstances of thecase, the duration of infringement andElectrabel’s overall resources.

The European Commission welcomedthe result, stating that, “Today's judg-ment reminds companies of their dutynot to implement concentrations of anEU dimension before receiving theCommission's approval (the so-called"standstill obligation"). Failure to complywith this requirement carries a risk of sig-nificant sanctions.”

General Court dismisses Electrabelaction, upholds Commission fine

BELGIUM|ENERGY CONCENTRATION

Illustration picture shows the building of Electrabel-GDF SUez before a press conference of Elec-

trabel to present the new commercial politic of Electrabel, at the GDF Suez tower, in Brussels,

Friday 20 April 2012. Electrabel is Belgium historic and main energy supplier.

By Elena Ralli

Delta Airlines eyes almost half of Virgin Atlantic

UNITED KINGDOM|AVIATION

Under the joint venture announced on 11December, Delta and Virgin would sharecosts and revenues on routes betweenBritain and North America, RTE Irelandreported.

The pair plan to cooperate on services be-tween New York and London, with a total ofnine daily round-trip flights from LondonHeathrow to JFK International Airport inNew York and Newark Liberty InternationalAirport in New Jersey.

Delta, the second-largest US airline by rev-enue after United Continental, has acquiredstakes in Grupo Aeromexico and Brazil's GolLinhas Aereas over the past year, and has longhoped to break into Heathrow.

In recent years, it has invested heavily tobuild a major hub in New York.

The tie-up with Delta will be a shot in thearm for Virgin Atlantic, which is the second-largest carrier at Heathrow after IAG's BritishAirways. It has been battered by rising fuelprices and the euro zone crisis. It lost £80 mil-lion (€99 million) in its last full year.

The Virgin Atlantic partnership will "pro-vide a more effective competitor betweenNorth America and the UK, particularly on theNew York-London route, which is the largestairline route between the US and Europe,"Delta Chief Executive Richard Anderson said

in a statement.The airlines said they would file an applica-

tion with the US Department of Transporta-tion for competition clearance and said the dealwould need to be reviewed by the US Depart-ment of Justice and the European Union'scompetition regulator.

The deal will give Delta greater access atLondon's Heathrow, a lucrative hub for corpo-rate passengers where landing slots are gener-ally hard to acquire.

British entrepreneur Richard Branson saidhe would retain his 51% stake in Virgin At-lantic and maintain the brand of the airline hefounded in 1984.

"The partnership allows both carriers tooffer a greatly expanded network at Heathrowand to overcome slot constraints, which havelimited the growth and competitive capabilityof both airlines," Branson said.

The two carriers will operate a total of 31peak-day round-trip flights between Britainand North America, 23 of which operate atLondon Heathrow. The partnership will besimilar to that operated by American Airlinesand BA since 2010 on transatlantic and someEuropean routes.

Singapore Airlines bought 49% of VirginAtlantic for $965m in 1999, but has been opento selling its stake since at least mid-2011.

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GREECE|DEFENCE

Qatar eyes Greek defence sector companiesOn 10 December, Greek Defence Minister Panos Pana-giotopoulos said Qatar is interested in Greek defence com-panies being privatised and could submit investment planswhen Prime Minister Antonis Samaras visits the Gulf stateearly in 2013. “Qatar is interested in a series of privatisa-tions regarding the Greek defence industry,” Pana-giotopoulos said in a statement after meeting Qatar’sCrown Prince Sheikh Tamim bin Hamad al-Thani inDoha. “They expect Prime Minister Antonis Samaras’ of-ficial visit here in the first few months of 2013, and theybelieve that the conditions will then be ripe for specific pro-posals and investment plans in our country.” Samaras wasinitially expected to visit Qatar in November to discuss in-vestment possibilities in the recession-hit economy but can-celled his trip at the last-minute due to a crucial meeting ofeurozone finance ministers. Possible companies of interestinclude the state-owned Hellenic Defence Systems andHellenic Vehicle Industry, which the Greek government isconsidering privatising.

ROMAMIA |INSURANCE

Eureko to pay Romanian cargo insurance claimInsurance company Eureko, with a Dutch majority inter-est holder, was ordered to pay a €6.6mn claim made by aRomanian clothing company based in Sibiu on account ofa cargo coverage insurance policy. The decision was issuedby the High Court of Cassation and Justice, at the begin-ning of December, and marks the final act in a ten-year trial,Romania Insider reported on 10 December. The benefici-ary of this end of year present is clothing manufacturer Co-chet SA. The €6.6mn is to cover the loss suffered followingthe destruction of a consignment of silk ties by a fire thatbroke out in the container. Eureko initially rejected Co-chet’s claim for recovery of damages due to suspicionsaround the circumstances of the event. Eureko officials haveexpressed their intention of observing the court decision,with the company’s financial status allowing for the full set-tlement of the claim.

ROMATIA|RETAIL

Il Passo opens first Bucharest outlet storeOn 8 December, Footwear retailer Il Passo was expected toopen its first outlet store in Bucharest located on the groundsof Fashion House Militari, Business Review reported on 7December. The store covers 130 square metres and sells some2,000 products from previous collections at discounts of upto 70%. Romanian retail company Il Passo was set up in 1999and presently runs a network of 11 stores in Bucharest,Brasov,Cluj-Napoca, Constanta, Iasi, Craiova and Timisoara.

ITALY|POLITICS

Monti does not commenton latest Berlusconi switchOn 13 December, outgoing Italian Prime Minister MarioMonti refused to comment on former premier SilvioBerlusconi's offer to withdraw his own candidacy in nextyear's election if the former European commissioner Montiagreed to head a centre-right coalition. Berlusconi, 76, ear-lier declared he is standing for his fifth term as prime min-ister. Asked about Berlusconi's offer to withdraw inBrussels, where he was attending a summit of EuropeanUnion leaders, Monti said it was not the time or place to re-spond and he was committed to leading the governmentin the brief time remaining before the 2013 budget is ap-proved and he resigns - probably before Christmas.


EUROPEAN UNION

Following a decision by the eurozoneon 13 December to provide nearly€50bn in long-delayed aid to Greece,Prime Minister Antonis Samaras saidtalk of a Greek exit from the singlecurrency is over. The Greek premiersaid the decision showed that Euro-pean solidarity was working and hiscountry would stay in the single cur-rency. "Grexit is dead. Greece is backon its feet. The sacrifices of the Greekpeople have not been in vain," Sama-ras said on arrival for talks with othercenter-right leaders in Brussels.

Of the immediate aid, some €16bnwill go towards recapitalisation and

resolution of Greece's banks, €11.3bnto finance the debt buyback and €7bnfor budget financing. A further €7.2bnwill flow in January to buttress Greekbanks and the remaining €7.6bn willbe paid in monthly instalments whenthe lenders’ conditions are met.

Samaras tweeted that for the firsttime, the policy mix is changing andthere is a real prospect for growth. “Weare already borrowing at lower ratethan many European countries andhave cut debt to unprecedented ex-tent,” Samaras said. “Within next fewweeks we'll recapitalise banks, whichwill help liquidity and job creation,

which is no. 1 priority,” he said in an-other tweet.

Meanwhile, Germany is to helpGreece set up a development fund toattract back private investors, thecountries' economy ministers said on13 December.

The fund will resemble and be sup-ported by Germany's KfW, or Kredi-tanstalt fur Wiederaufbau, thestate-owned development bank thathelped to rebuild the economy of WestGermany after the World War II.

The fund will be financed by exist-ing funds and private investment, theministers said.

Samaras declares "Grexit" era deadGREECE|ECONOMY

South Stream facilities construction to start in 2013BULGARIA|ENERGY

The energy giant Gazprom an-nounced that a working meeting be-tween Alexey Miller, Chairman of theGazprom Management Committeeand Dimitar Gogov, Executive Direc-tor of the Bulgarian Bulgargaz, tookplace on 12 December.

Miller and Gogov met inGazprom’s headquarters and discussedbilateral co-operation in the energysector and the prospects for widening

co-operation in other spheres.However, the meeting’s emphasis

was put on the successful implemen-tation of the South Stream project.Gazprom informed that during themeeting, it was mentioned that theconstruction of gas receiving facilitiesand those intended for its furthertransmission through Europe wouldstart in Bulgaria in 2013.

The Bulgarian Ministry of Econ-omy, Energy and Tourism did nothave a comment, while a representa-

tive of Bulgargaz confirmed forNewEurope that indeed the shareholdersof South Stream Bulgaria envisagedthe construction of the facilities inBulgaria to start in the coming year.

Miller said in June that the first gassupplies via South Stream pipelinewill arrive in Bulgaria in December2015. The implementation of the pro-ject’s plan on time became even morepossible after the final investment de-cision between Gazprom and Bulgariawas reached on 15 November.

Moldavian milk tycoon acquires Prodlacta BrasovROMANIA|DAIRY

Jardan Lapte Company ( JLC), themain player on the dairy market inMoldova owned by businessmanVladimir Jardan, is to take over themajority interest in Romanian dairyproducer Prodlacta Brasov, currently ininsolvency. The move is part of a reor-

ganization plan that was officially con-firmed by the Brasov Tribunal, Roma-nia Insider reported on 10 December.The JLC Group reached a €283mnturnover last year and its business in-terests cover Moldova, Ukraine, Kaza-khstan, Germany and Romania. With

2,500 employees on its payroll, JLCprovides over 80 varieties of dairyproducts. Prodlacta Brasov entered in-solvency following the loss of one ofits major sources of revenue, namely amilk delivery contract with the Ro-manian state in March this year.

Greek Prime Minister Antonis Samaras during a visit to Bavarian State Governor in Munich, Germany, 9 December 2012.


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TURKEY | FINANCE

Sabanc?, German giant inks dealSabanc? Holding, the parent company of the Sabanc?Group, Turkey’s leading industrial and financial conglom-erate recently entered into a 50-50 partnership deal withGerman energy giant E.On, Zaman reported. The deal wasannounced at a meeting attended by Sabanc? HoldingChairwoman Guler Sabanc? and Turkish Energy MinisterTaner Y?ld?z. It should be noted that the deal came afterSabanc?'s former partner in Enerji SA, Austrian energycompany Verbund, agreed to sell E.On its 50% stake in thecompany for an unspecified amount. Sabanc? HoldingChairwoman said that the deal envisage that the companywill now produce 8,000 megawatts [MW] of power andmake up 10% of the Turkish electricity market by 2020. Sa-banci said that this deal will allow Enerji SA to see invest-ment from one of the world's best capitalized energyproducers and further its lead as Turkey's largest privatepower company. Sabanc? also underlined that Enerji SAwill increase its use of renewables to half of the company'senergy mix by 2020. “In fact, around half of the 3,700 MWof power Enerji SA is currently producing or will be pro-ducing by the end of 2013 will already be green energy,” Sa-banc? said. According to Zafer Kurtul, CEO of Sabanc?Holding, Enerji SA's renewable mix will focus on wind en-ergy and secondly hydroelectricity. Sabanc? and E.OnCEO Johannes Teyssen said that Enerji SA intentions ofproducing roughly 5,000 MW by the end of 2013 in un-derway and will easily reach 8,000 MWby 2020.

ALBANIA | ENERGY

Vetro Energy to buy AlbpetrolVetro Energy, is a Singapore and Houston, Texas based op-erating and management company recently announced thatit was asked for a performance guarantee in connection withtalks for the purchase of Albania's State Oil and Gas com-pany, Albpetrol, AENews reported. The requested guaran-tee is for 20% of the consideration. Vetro Energy is ready toprovide such a performance guarantee but admitted someamount of work is still left and a guarantee of this nature iscustomarily submitted only after signing a formal contract.Rezart Taci who owns majority share in Vetro Energy,stated: "We have requested a number of additional docu-ments from the Government, which we require. In responsethe Government has asked for a performance guarantee,which Vetro Energy is pleased to provide, and will be inplace within the next few days.” He stressed a lot of detailsare involved in such complex discussions and any delayamid such circumstances should not be surprising. How-ever, he is confident that the Vetro Energy will finalsie talksand reach a successful conclusion.

TURKEY | DEFENCE

NATO to agree to send Patriots to TurkeyNATO is reday for a deployment of Patriot missiles toTurkey to bolster its air defences against Syria, Zamanreported. Turkey last month asked the 28-nation allianceNATO for Patriots, which can be used to intercept mis-siles and planes, after weeks of talks with allies about howto shore up security on its (560-mile) border with Syria,which is immersed in civil war. “Turkey's request, when itcame to Patriots, was to augment its air defenses with thecapacity to deal with the threat of ballistic missiles andparticularly the threat of ballistic missiles potentiallyarmed with chemical warheads,” another an anonymousNATO diplomat. He added that the decision on whetheror not to deploy Patriots, and for how long is, like allNATO decisions when it comes to the deployment ofmilitary forces, a national one. Syria is believed to haveseveral hundred surface-to-surface missiles capable ofcarrying chemical warheads.

First Investment Bank (QFIB), based inQatar recently announced an acquisitionof 40% stake in English Home, the lead-ing retailer of home textile products inTurkey, Zaman reported. It should benoted that English Home, is a leadinghome textile retailer with a strong pres-ence in the Turkish market. With the ac-quisition of 40% stake in English Home,QFIB, the first independent Shariahcompliant bank in Qatar, authorised bythe QFC Regulatory Authority marksfirst venture into the retail sector and en-ters for the second time in the Turkishmarket.

QFIB Chairman Abdulla bin FahadAl Marri is pleased with its second ac-quisition in Turkey which has recently re-ceived an “investment grade” by Fitch dueto its high-performing economy. He saidthat the company’s venture into the retailsector came at an appropriate time asconsumer spending and foreign direct in-vestment is expected to increase in Turkeyat same time.

Emad Mansour, CEO of QFIB, isvery excited to venture into the retail sec-tor, in particular in Turkey which isequipped with a vibrant retail marketdriven by a population with an increas-ing purchasing power. He said, “EnglishHome owned by the Aydin Family, whoare also our partners in Memorial HealthGroup, is a model success story as it haswitnessed exponential growth in a shortperiod of time.”

He went on to say that the company islooking forward to working with theAydin Family to further strengthen theposition of English Home in the Turkishmarket and also facilitate rapid growth.QFIB’s acquisition of English Home ispart of QFIB’s strategy to show its com-

mitment to portfolio and geographicaldiversification. The acquisition also re-flects the bank’s strategy of investing inhigh growth companies that are leadersin their respective fields. After the acqui-sition, QFIB will be entitled to assist thefirm in realising its growth targetsthrough institutionalisation of businessoperations and implementing best-in-practice corporate governance standards.

Yasar Aydin, Chairman of TurgutAydin Holding Company has expressedsatisfaction over the news of QFIB as ashareholder in English Home. NotingTurkey’s favourable market dynamics,Aydin said that with QFIB’s support, thecompany is confident that it will be ableto capitalise on the growing demand forhome textiles and further build uponEnglish Home’s recent success. Hestressed that Turkey is one of the leading

textile producers and exporters in theworld and for past few years the countryhas achieved considerable growth bothdomestically and internationally.ErdemGunduz, CEO of ‘English Home’, said:“English Home has demonstrated astrong performance, and managed to be-come the leading brand of Turkish hometextile market in a short period of time.”Noting the high growth potential of thedomestic market, the company is confi-dent that it will be able to capture an evenlarger market share, added Gunduz. Hewelcomed QFIB as a shareholder, whichmarks an important milestone for thecompany.

According to him the company in-tends to become the leading brand inTurkey and in the neighboring region,with help of QFIB’s expertise and inter-national popularity of English Home.

Qatari Bank bites 40%chunk off leading retailer

TURKEY |BUSINESS

The First Investment Bank of Qatar buys huge chunk of English Home stores in Turkey

Berisha to grant citizenship to ethnic Albanians worldwideALBANIA|CITIZENSHIP

At a recent government meeting Tirana,Albania’s Prime Minister Sali Berisha hasannounced a plan to grant Albanian citi-zenship to ethnicAlbanians across theglobe, AENews reported. He stressedthat Albanians in Albania and Kosovoshould feel as same. According to Berisha,

such a decision by the government willnot lead to any conflicts between Albaniaand its neighbors.

It should be noted that Kosovo's pop-ulation is more than 90% ethnic Albanianwhile ethnic Albanians form about aquarter of the population in neighboring

Macedonia. Smaller ethnic Albaniancommunities exist in Montenegro andSerbia. Couple of weeks ago, Bersha’sstatement aboutAlbanian lands inGreece, Serbia, Macedonia and Mon-tenegro had triggered strong reactionfrom Greece.

Avramopoulos looks to accession for resolution to name issueFYROM |EU RELATIONS

Following the General Affairs Council onEnlargement, European Commissioner forEnlargement and Neighbourhood Policy,Štefan Füle spoke yesterday at the pressconference describing the progress thatTurkey, the Former Yugoslav Republic ofMacedonia, Serbia, Kosovo and Albaniahave made in order to become part of theEuropean Union.

As Commissioner Füle stated: “This wasa dynamic year for enlargement: Croatia onits way to join the EU, Montenegro startingnegotiations, Serbia becoming a candidatecountry. With these conclusions there is agood perspective for the next year to keepthe momentum: On one side defining keychallenges and reforms the enlargementcountries need to address. On the other side

showing the willingness of the EU to movethem forward on the EU path, once theyfulfill the necessary conditions. This alsounderlines the credibility of enlargement.”

Regarding Turkey, Commissioner Fülesaid that the accession process is back ontrack and that there has been significantprogress concerning visa issues that aim toallow free EU entry for Turkish citizens.

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MONTENEGRO|DIPLOMACY

Montenegro, China up tiesMontenegro Prime Minister Milo Djukanovic recently an-nounced that his country is keen for more economic co-operation with China in the coming years. After beingreappointed as the Balkan country's prime minister for aseventh term, Djukanovic said that Montenegro expectsgrowth in its economic cooperation with China, Mon-tenegro Times reported. He said that Montenegro consid-ers China as a very desirable partner. Djukanovic said, “I amglad to say that, for Montenegro, this partnership is not anovelty but a kind of tradition.”

CROATIA|BUDGET

Wider deficit for 2013Croatian lawmakers recently adopted budget for 2013which was backed by 83 MPs of those present in the 151-seat parliament. The budget was opposed by six deputiesand six abstained. The budget was based on a wider deficitof 3.1% of output and a forecast of a 1.8% growth in the re-cession-hit economy, Javno reported. The centre-left gov-ernment led by Prime Minister Zoran Milanovic outlinedhigher debt payments, restructuring costs for the country'sailing shipyards and Zagreb's contribution to the EUbudget as main reasons for the increase in deficit, a rise fromthis year's projected 2.9% of GDP. Croatia will join EU inJuly 2013. The 2013 budget envisaged spending at 124.5bnkuna and revenues at 113.7bn kuna.

CROATIA|STADIUM

Croatia wins Qatar contractCroatia recently won a contract to build an indoor sportsstadium that will host the World Handball Championshipsin Qatar in 2015. The cost of the project is expected to sur-pass $130mn. The contract was awarded after a Croatiandelegation comprising of firms made a visit to Qatar topresent the work carried out for the 2009 World HandballChampionships in Croatia, Javno reported. The 4.4 hectaresports complex will host 15,000 of Qatar's growing popu-lation of handball fans in its main stadium. Croatia will startconstruction of the complex in 2013.

BOSNIA-HERZEGOVINA|MEDIA

RTV FBIH board replacementEfforts were recently made to replace the entire RTVFBIH (Radio Television of Federation of BiH) SteeringBoard. The Organisation for Security and Cooperation inEurope (OSCE) in Bosnia, the Office of the High Repre-sentative, the United States Embassy in Bosnia and the Eu-ropean Union Special Representative in Bosnia stronglyopposed the move as they believe that it will undermine theindependence of the public media in the country, Fars newsagency reported.

SERBIA|EU AFFAIRS

Berlin, Belgrade talksSerbian Deputy Prime Minister Suzana Grubjesic recentlytold German Chancellor Angela Merkel that Serbia is will-ing to work on the EU integration process and expects Ger-many to become a strategic partner of Serbia. Grubjesic saidthat Serbia will be unable to progress on EU path or eco-nomically without the support of Germany, which is one ofthe most influential EU states. At the Christian Demo-cratic Union congress in Hanover, Grubjesic said Serbia hasadopted the correct steps in the process of European inte-gration. Serbia’s First Deputy Prime Minister AleksandarVucic has said in Washington that the EU accession is stillthe main priority of Serbia.


ENLARGEMENT

Aleksandar Pejovic, State Secretary forEuropean Integration and Chief Nego-tiator for Negotiations on the Accessionof Montenegro to the European Union,recently met with Bulgaria's ForeignMinister Nikolay Mladenov in Sofia,Montenegro Times reported.

In course of talks, Mladenov expressedreadiness of Sofia to support Montene-gro in the process of its talks for EU ac-cession. He hailed Montenegro formoving dynamically on its EU path asevident in the opening of negotiations onEU accession. He said that Montenegrois also working towards Euro-Atlantic in-

tegration and also investing in good rela-tions with its neighbours, which is an im-portant factor in its success and anexample to the entire region. Mladenovstressed that Montenegro needs to haveserious effort and capacity in the EU ne-gotiations talks and in this regard he of-fered full support of Bulgaria. He addedthe two countries have signed a Memo-randum of Cooperation in European andEuro-Atlantic integration that needs tobe implemented in practice.

According to Mladenov, Bulgaria willshare its experience and expertise withMontenegro in many areas related to

preparations for membership, includingmechanisms applied in the negotiationprocess, preparing the public administra-tion and how to engage experts from civilsociety in the negotiation process.

In turn, Pejovic said that Montenegrovalues Bulgaria's support and is ready tofurther bolster co-operation between thetwo countries in the field of Europeanand Euro-Atlantic integration. He saidthat both countries should also set up amechanism for regular inter-governmen-tal consultations, adding that both coun-tries can also work for a better and stableregion fully integrated into the EU.

Bulgaria to support Montenegro in EU talks

MONTENEGRO|EU AFFAIRS

Dubrovnik Airport records busiest year CROATIA|TRANSPORT

Dubrovnik Airport promises to end thisyear as being the fourth busiest in the for-mer Yugoslavia, surpassing Ljubljana,Javno reported. After 25 years, DubrovnikAirport has surpassed its all time annualpassenger record set during the Yugoslavtimes in 1987. In the elapsed elevenmonths of this year, Dubrovnik Airporthandled 1.460.549 passengers comparedto 1987 when it welcomed 1.460.354 forthe entire year. It should be noted that1987 was the most successful year in Yu-goslav aviation, as the airport handled835.818 passengers on international

flights and a further 586.742 on domes-tic services. Following the breakup of Yu-goslavia, the airport surpassed the onemillion passenger mark in 2005.

Overall the airport registers a stellaryear for the seaside airport, which is re-porting growth of 9.9% compared to thesame period in 2011. Croatia’s EU acces-sion in 2013, which is expected to boosttourism, will benefit Dubrovnik Airportto a great extent. Already innumerableairlines have announced launch of flightsto the city. The airport authorities are cur-rently negotiating with Hainan Airlines

to open a seasonal service from the resortcity of Sanya on Hainan Island in South-ern China next summer season. Earlierthe city was served by the Gruda Airfieldwhich opened for commercial traffic in1936 and was in use only during the sum-mer months. Today, Dubrovnik is toutedtoday as the most modern passenger ter-minal in the country.

A new terminal is being planned inplace of the old airport building, con-structed in 1962, which has now been de-molished to construct a new modernstructure.

Raiffeisein introduces e-commerce 3-D SecureBiH|BANKING

Raiffeisen Bank Bosnia-Herzegovinahas now become the first bank in Bosniaand Herzegovina to offer their customersE-Commerce and 3-D Secure acquiringservices, Fars news agency reported. Tieto,the leading IT service company in North-ern Europe providing IT and product en-gineering made this possible by offering

Card Suite solution to the bank, Fars newsagency reported. The solution providesadded value to its merchants by alleviatingthe number of fraudulent user chargebackcases, representing the highest proportionof charge backs in the Internet environmentand also provides the opportunity to in-crease sales and cut disputed transactions.

Maris Ozolins, Director of Cards, Tietosaid that the solution offered to customerswill yield safety entailing increased sales andgeneral card brand promotion. Maris addedthat merchants feel secured allowing en-hanced card acceptance in internationaltransactions and the development of cardbusiness.

EU Enlargement Commissioner Stefan Fule, left, shakes hands with then-Montenegrin premier Igor Luksic in Podgorica, Montenegro, 13 October 2011.

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NORWAY | BIOTECH

Billionaires back Genevabiotech centre planTwo of Switzerland’s wealthiest men are collaborating withthe University of Geneva and EPFL, Lausanne’s federal in-stitute of technology, on a plan to create a new biotech cen-tre in Geneva’s former Merck Serono headquarters, TheLocal reported on 6 December. A newly created companyprevious week put in an offer for an undisclosed sum to buythe building, which Merck Serono put up for sale last Julyafter deciding to axe 1,250 jobs at the site. The company,Campus Biotech SA, was created by Hansjorg Wyss, a bil-lionaire medical device entrepreneur, and Ernesto Bertarelli,another billionaire whose family founded Serono before sell-ing it to the German pharma company Merck in 2006. Thepublic-private project for the centre, focusing on healthcare,biotechnology and life sciences, was outlined at a press con-ference in Bern on 5 December. Neither of the billionaireswas in attendance, although Jorg Neef, a representative of thepair’s company, joined EPFL President Patrick Aebischerand University of Geneva Rector Jean-Dominique Vassalito discuss the scheme. Neef said Campus Biotech’s offer forthe Merck Serono complex in Geneva’s Secheron neigh-bourhood amounted to several hundred million SwissFranks. The proposed new research centre involves the cre-ation of ten new laboratories to be run by the university andEPFL with an endowment of 125 million francs over sixyears from a foundation established by Wyss, who along withBertarelli is one of Switzerland’s wealthiest citizens. TheWyss Foundation funding will create employment for 120 to150 researchers in fields such as immuno-engineering, neuro-engineering and regenerative engineering, according to in-formation posted on EPFL’s website.

ICELAND | PHARMACEUTICALS

DeCODE Genetics sold for $415 mlnIcelandic genetic research company deCODE Geneticswas sold to pharmaceutical manufacturing companyAmgen on 10 December for $ 415 million (€317 mil-lion), Iceland Review reported on 10 December. The all-cash transaction was unanimously approved by theAmgen board of directors. The sale is expected to closebefore the end of the year. CEO of Amgen Robert ABradway said in a press release that deCODE Geneticshad built a world-class capability in the study of the ge-netics human disease. “This capability will enhance ourefforts to identify and validate human disease targets,” headded. Founder and CEO of deCODE Genetics KariStefansson said the deal would enable the company’s re-search to translate into therapies for patients. “One of theways to truly realize the full value of human genetics, isto make our research synergistic with drug developmentefforts where target discovery, validation and prioritiza-tion efforts can be accelerated,” said Kari.

SWITZERLAND | PHARMACEUTICALS

Novartis chemical spill injures 13 near BaselSix people were rushed to hospital and seven others neededmedical attention on Tuesday after a toxic chemical leak ata Novartis plant in the canton of Basel Country, The Localreported on 11 December. The leak occurred shortly be-fore noon at one of the Swiss pharmaceutical giant’sSchweizerhalle plants in Muttenz, cantonal police said. Po-lice said according to initial findings a few litres of a caus-tic liquid chemical spilled, releasing a gas that irritates themucous membranes. The six hospitalised people, five work-ers from an outside cleaning company and a Novartis em-ployee, complained of a severe cough, police said. Three ofthem were released from hospital within hours, while an-other seven people were medically treated on site.

The Swiss commodities giant Glen-core said Chinese authorities have ap-proved its purchase of the Canadianagri-business group Viterra and that ithad thus cleared the last regulatoryhurdle to the $6.1-billion deal, TheLocal reported on 9 December.

"This was the final outstanding reg-ulatory approval of Glencore's acqui-sition of Viterra," the Swiss companysaid in a statement previous Friday,adding that it now expected the deal

to take effect on 17 December.Glencore put in its $6.1-billion bid

for Viterra on 20 March, offering apremium of 48% over the Canadiancompany's closing share price on 8March.

The deal had the backing of theViterra board and received a massivethumbs-up from shareholders in lateMay and amounts to one of thebiggest takeovers in recent years in theagricultural commodities sector.

By July, Glencore had received thegreen light from regulators in Canada,the United States and Australia, buthas had to wait patiently for the finalapproval from the Chinese to comethrough.

The Swiss company was alreadypresent in the agricultural commodi-ties market, but the Viterra takeoverwill move it into a whole new leaguein a sector dominated by US giantsArcher Daniels Midland and Cargill.

Glencore gets green light to buy Canada's Viterra

SWITZERLAND|MINING

Glencore International AG in Baar, Switzerland.

Two dairy farms closed due to poor conditionsICELAND|AGRICULTURE

The Icelandic Food and VeterinaryAuthority (MAST) has revoked theoperating licenses of two dairy farmsin West Icelandfor breaking the ruleson health and hygiene for the produc-tion of milk and the slaughtering ofanimals, Iceland review reported on 10December. The farms are Ingun-narstaoir in Reykholahreppur andBruarreykir in Borgarfjorour.

In a letter from MAST dated 30November, it is stated that despite re-peated demands, improvements wereimplemented late, poorly or not at all.The farms in question have been or-dered to halt the delivery of milk andthe slaughtering of livestock as of 1December.

Among the complaints are crowdedconditions among the livestock, which

were found wading in their own ma-nure, unhygienic conditions in thehand washing area, including a lack ofsoap, and unclean milking equipment.

Viktor Stefan Palsson, director ofMAST, said that it is being lookedinto whether the farms have brokenanimal protection laws, penalty forwhich may include fines or impris-onment.

Aker Solutions awarded global Shell contractNORWAY|ENERGY

The Norwegian and international oil serv-ices provider Aker Solutions has signed aframe agreement with Shell for the deliv-ery of subsea umbilicals and cables glob-ally, Norway Post reported on 12December. The size of the frame agree-ment is dependent on call-offs and thenumber of projects that Shell decides toexecute. However, Aker Solutions esti-mates that the frame agreement couldgenerate revenues between $200 and $400million. Order intake will be bookedwhenever the specific contracts are signed.

The Enterprise Framework Agreement(EFA) with Shell is signed for the dura-tion of five years with an option for an ad-ditional five years. Aker Solutions willdeliver dynamic and static steel tube um-bilicals for both shallow and deepwater ap-plications.

The EFA has a global scope. Shell's sub-sea projects are primarily focused on theNorwegian continental shelf, UK, Gulf ofMexico, West-Africa and Brazil.

"We look forward to safeguard Shell'svaluable assets and contribute to their pro-

duction success globally. Aker Solutionshas developed market-leading umbilicalstechnology, proven to provide the widestrange of functionality. We are extremelypleased and honored by this award," saidTove Roskaft, head of Aker Solutions'umbilicals business. The umbilicals and ca-bles will be manufactured and deliveredout of Aker Solutions' facilities in Moss,Norway and Mobile, Alabama, supportedby project management, design and engi-neering in Fornebu, Norway and the Mo-bile office.

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GEORGIA|CORRUPTION

Georgia scores 51st rank in indexBerlin-based anti-corruption watchdog group recently un-veiled that Georgia has gained 51st position in survey ofTransparency International’s annual Corruption PerceptionIndex (CPI), The Messenger reported. This year CPI Geor-gia shares its 51st position with Seychelles, and ranked aheadof several EU members states, including the Czech Repub-lic, Latvia, Slovakia, Romania, and Bulgaria, and slightlybelow Rwanda, Lithuania, Costa Rica, and Hungary. Trans-parency International Georgia noted that Georgia has madegreat headway since 2004 in tackling different forms of cor-ruption, including petty bribery which is not present now inGeorgians’ everyday life. The group said that the country’santi-corruption legislation has also improved and trans-parency of government activities has also increased in severalareas. However important gaps in the country’s anti-corrup-tion framework were noted in 2004-2012. Transparency In-ternational Georgia said that the weakness of parliament andthe judiciary has undermined the democratic system ofchecks and balances leading to a dominant executive branch.Transparency International Georgia also accused political cir-cles of the country for using important government agencies,including the Prosecutor’s Office and the State Audit Officeas mere tools. Top executive officials performed their func-tions without any proper accountability and oversight, pavingway for abuse of power and corruption. “An imbalanced sys-tem of governance also resulted in extreme politicising ofpublic bodies, which was particularly evident during the lastelection campaign,” it said.

GEORGIA|EU-AFFAIRS

Georgia striving to get closer to EUThe amount of progress in the application of EU visa fa-cilitation and readmission agreements was recently sum-marised in Tbilisi. The first step to Georgia’s Europeanintegration is EU-Georgia visa facilitation agreement andthe “roadmap” for visa-free travel. This shows that the coun-try is grappling to get closer to the bloc, Civil Georgia re-ported. The next step on path to EU integration is the VisaLiberalisation Action Plan. Georgia will be the third coun-try among six Eastern Partnership states after Moldova andUkraine to have visa liberalisation action plan with the Eu-ropean Union. In 2010 the visa liberalisation dialogue hadstarted to address areas directly related to document secu-rity, border management, migration, mobility and asylum.Georgia expects the Visa Liberalisation action plan to bepresented by end of this year. Experts feel that the transitionof power in the country as a result of parliamentary electionsin October can yield any effect on the introduction of theaction plan.

AZERBAIJAN|DIPLOMACY

Azerbaijani ambassador toSwitzerland visits canton AargauAmbassador of Azerbaijan in Switzerland Ekrem Zeynallirecently paid an official visit to canton Aargau, news agen-cies reported. During the visit, the diplomat met primeminister of canton Zuzanne Hohule. At the talks, bothsides said they were pleased with the high level of Azerbai-jani-Swiss relations. At the same time, they stressed theneed to establish contacts with cantons of the Confedera-tion along with expansion of ties on the federal level. Thesides exchanged views around possible cooperation withcanton Aargau in economic, humanitarian and culturalsphere and also reached a primary agreement on conductionof the days of Azerbaijani culture in canton. As part of thevisit the ambassador also took part as an honorary guest inthe session of the parliament of canton and was welcomedby the chairman of the parliament.


EASTERN PARTNERSHIP

Ambassador of Azerbaijan to Belgiumand also head of the Azerbaijani delega-tion to the EU Fuad Isgandarov recentlysubmitted his credentials to EuropeanCommission President Jose Manuel Bar-roso, news agencies reported. At the meet-ing, Barroso asked the ambassador toconvey his greetings to Azerbaijan’s Presi-dent Ilham Aliyev. He discussed develop-ment of relations between the EU and

Azerbaijan, the activity of Azerbaijanwithin the Eastern Partnership andprogress in this field. He is confident thatthe positive image of Azerbaijan formingin Europe will strengthen further by con-tinuing political and economic reforms.

Taking into account the crucial role ofthe strategic partnership in energy coop-eration between the EU and Azerbaijan,Barroso said he was pleased with the early

implementation of the South Gas Corri-dor. Voicing his full support to the OSCEMinsk Group's action in resolving theconflict, Barroso said the EU was ready tocontribute to the settlement of the conflict.In return, the ambassador extended thegreetings of Azerbaijani President to thepresident of the European Commis-sion. He stressed that Azerbaijan is one ofthe most reliable partners of the EU.

Envoy discusses energy, political ties with Barroso

AZERBAIJAN|EU AFFAIRS

European Commission President Jose Manuel Barroso, right, welcomes Azerbaijan President Ilham Aliyev in Brussels, 22 June 2011. Ambassador of

Azerbaijan to Belgium recently discussed development of relations between the EU and Azerbaijan with Barroso.

Lavrov hails Georgia’s efforts to normalise ties GEORGIA|DIPLOMACY

Russia's Foreign Minister Sergey Lavrovrecently learnt from media that Georgiawants to normalise ties with Russia with-out any preconditions. After the NATO-Russia Council meeting in Brussels,Lavrov said that Moscow is keen to knowwhat Georgia's new government is offer-ing in order "to normalise" ties between thetwo countries and what where those areasin which and terms on which Moscow

would cooperate with Georgia, CivilGeorgia reported.

“Georgia's new leadership has publiclystated for several times about willingnessto normalize relations with Russia and inoverall with neighbours in the region.We've actually heard about it throughmedia sources and we want to understandwhat specifically is being offered to do andhow,” Lavrov said. He added that Moscow

considers Georgian people as friendly andboth countries have similar history, cultureand in humanitarian ties. Lavrov stressedthat Moscow has never avoided contactswith Georgian neighbours and has nevercut any diplomatic ties with Georgia. “Itwas not us who cut diplomatic relationswith Georgia after the adventure, whichwas launched by Saakashvili by attackingSouth Ossetia,” he said.

Baku, Budapest to boost business contacts AZERBAIJAN|BUSINESS

Baku recently hosted Azerbaijan-Hungary business meeting under theaegis of Ministry of Economic Devel-opment. The event which was organ-ised by AZPROMO (AzerbaijanExport and Investment PromotionFoundation) had garnered business-men on food industry, agriculture, fi-nance, construction, transport,tourism, news agencies reported.

Speaking at the event, Azerbaijan’sMinister of Economic DevelopmentShahin Mustafayev said that the politi-cal, economic and cultural relations be-tween the two countries successfullydeveloped and there was durable legisla-tion base on co-operation between Azer-baijan and Hungary. Both countries have

signed 30 documents on different sectors,including economy. He also said tradeturnover between Azerbaijan and Hun-gary went up 2.6 times. Currently, fourHungarian companies operate in Azer-baijan. Envoys of Hungarian companieson construction, lorry production, wastemanagement, tourism, air transportationsrecently met their Azerbaijani counter-parts in Baku. The minister noted there isgreat potential between the two countrieson mutual investment, agriculture,tourism, pharmacology.

In turn, State Secretary for Foreign Af-fairs and External Economic RelationsPeter Szijjarto stressed that Hungary wasinterested in expanding co-operationwith Azerbaijan and invited the busi-

nessmen for active co-operation. Accord-ing to Szijjarto, there was a great poten-tial between two countries onestablishment of relations in construction,agriculture, pharmacology, water econ-omy (water treatment and sewerage sys-tem), bus and production of its spare parts, oil and gas sectors. He mentioned thatcurrently 3,000 enterprises engaging insmall and medium entrepreneurship op-erate in Hungary and they are interestedin co-operation with Azerbaijani busi-nessmen.

Szijjarto also appreciated launch ofHungary Trading House and expressedhope that the trading house will have agreat role in development of links be-tween two countries.

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BELARUS|POULTRY

Nicaragua imports bannedBelarus has imposed temporary restrictions on imports ofpoultry from Nicaragua due to the recent outbreak of New-castle disease in the country, the veterinary and food surveil-lance department of the Agriculture and Food Ministry ofBelarus said, BelTA reported. According to the informationprovided by the World Organization for Animal Health, thecase was registered in Granada, Nicaragua. Belarus has tem-porary banned the import of live poultry, incubating eggs,poultry meat and all other kinds of processed poultry, feath-ers, fodder in order to prevent a spread of the disease.

BELARUS|TRADE

Minsk, Karachi ink MoUs Belarus and Pakistan have signed agreements on trade-eco-nomic co-operation, investments protection and avoidanceof double taxation. It was agreed in a meeting that the Be-larusian investment can help Pakistan to lead and generatemore employment opportunities as well. It was further dis-cussed that if the commercial exchanges between the twocountries are increased and become regular, it would cer-tainly add to the growth of bilateral trade and investment.

BELARUS|JUSTICE

Belarus, Italy sign dealAn agreement on co-operation has been concluded in Minskby the National Bar Association of Belarus and Italy’s Stu-dio Legale, the National Bar Association of Belarus said. Thesides shall exchange the information of mutual interest, prac-tices and background materials. According to the Chairmanof the Belarus Bar Association Viktor Chaichits, the agree-ment will help intensify mutual co-operation in the legalsphere between Belarus and Italy and promote deepening ofall-round relations between the two countries. He stressedthat Belarusian lawyers are always open to dialogue and co-operation. President of the Studio Legale of Italy IsabellaCusanno noted that the main objectives of their centre is theprotection of the rights of Italian citizens abroad, protectionof the rights of children left without custody, juridical researchand organization of seminars.

BELARUS|CIS

Chairmanship concept Belarus will submit its Commonwealth of IndependentStates (CIS) chairmanship concept to other countries ofthe CIS in early 2013, Chairman of the CIS ExecutiveCommittee - Executive Secretary Sergei Lebedev told re-porters. Lebedev said the concept of Belarus’ chairmanshipin the CIS is already ready. "I can now say that the conceptis interesting. It includes a range of activities to be carriedout both in Belarus and in other countries of the Com-monwealth,” he said.

UKRAINE|ENERGY

Ukraine, India seek tiesOn 12 December, Ukraine’s President Victor Yanukovych ex-pressed the need to strengthen ties between India and Ukrainein the energy sector. “We want to strengthen ties in the energysector. Ukrainian companies have resources to provide assis-tance to India in the areas of nuclear, thermal, hydro, solar andwind energy, besides helping build energy infrastructure andplants,” he told delegates at the India-Ukraine business sum-mit organised by the Confederation of Indian Industry (CII).He added that Ukraine is interested in implementing jointprojects with India in the development of gas turbine powerplants as well. Ukraine will also bid for providing equipmentand services to India’s energy facilities, he said.

Russia and Ukraine might be close tosigning a new gas supply deal this weekif Ukrainian President ViktorYanukovich visits Moscow on 18 De-cember, news agencies reported.

Russia’s ambassador to UkraineMikhail Zurabov said the trip could in-deed take place if the deal is ready bythat time. “If this meeting happens onthe 18th – and work is under way on itsagenda and content – it will happen onlyif there is an agreement to be reached,”Interfax quoted him as saying.

When Yanukovych and Putin meet,energy issues will be at the top of theagenda, Zurabov said, adding thatUkraine’s possible integration with Rus-sia-led Custom Union will also be dis-cussed. The two sides are continuing towork on these issues, and contacts be-tween the two presidents are constantover the phone, added the ambassador.

Separately, Interfax quoted an aide toRussian President Vladimir Putin assaying that a meeting between Putin andYanukovich was being discussed thoughno date had yet been set.

On 12 December, Russian gas mo-nopoly Gazprom CEO Alexei Millermet Ukrainian Energy Minister YuriBoiko in Moscow. The meeting ad-

dressed the prospects for long-term co-operation in the gas sector, Gazpromsaid in a statement. Moreover, the focuswas placed on the issues of uninter-

rupted Russian gas transit via Ukraineto the European consumers this winter,taking into account gas inventory of theUkrainian UGS facilities.

Kiev, Moscow gas talks continueUKRAINE|ENERGY

Gazprom CEO Alexei Miller addressed the prospects for long-term co-operation in the gas sector

with Ukraine.

Belarus to study public-private partnership practisesBELARUS|FOREIGN EXPERTISE

Minsk will host a conference on Pub-lic-Private Partnership Development inBelarus to study foreign experience inthe area, BelTA quoted Irina Novikovafrom the Public Administration Acad-emy as saying. The participants of themeeting will get familiar with the prac-tices used in Russia, Ukraine and Kaza-khstan, the countries which possesscertain knowledge in applying this busi-ness model.

Novikova said Belarus uses elements ofthis model in some of its industries andareas yet lacks the corresponding legalframework. “The Law on Public-PrivatePartnership in Belarus should have been

adopted this year. The draft law was dis-cussed in 2011,” Novikova said. The doc-ument is likely to be signed into law inthe first quarter of 2013, she said.

“It is an important document for thecountry, which will give a boost to co-op-eration between the state and private in-vestors,” Belarus Premier MikhailMyasnikovich noted in his message tothe participants of the forum.

“Attention to the public-private part-nership in Belarus characterises in thebest way possible the modern stage of thecountry’s economic policy amid theglobal economic challenges. At its corethe public-private partnership can be

viewed as a deflection of one of the basicprinciples of the Belarusian economic de-velopment model, a balance of interestsin the society and the state. Things thatbenefit business and the society will al-ways find support at any levels of author-ity,” the message runs.

Novikova recalled that during this five-year period, Belarus is set to switch overto the innovation way of development. Itwill be hard to achieve the goal using onlypublic funds. Therefore, it would be greatto involve business in this. "Russia hasquite successfully managed to implementthis idea. We also need to enact suchlaws,” Novikova said.

Minsk-Chisinau trade increases 13% in January-OctoberMOLDOVA|TRADE

In January-October the trade betweenBelarus and Moldova amounted to$285.4mn, up 12.7% compared withthe same period 2011, the BelarusianEmbassy in Moldova said, BelTA re-ported on 10 December.

In particular, in January-October2012 the Belarusian export to Moldovamade up $220.5mn, up 13.4% over thesame period a year earlier. Deliveries ofMoldovan goods to Belarus rose by10.1% to 64.9mn in the period underreview.

In January-October 2012, Belarushad a surplus of $155.6mn in trade with

Moldova, an increase of 14.8% asagainst the same period in 2011. Be-larus strengthened its position as themain consumer of Moldovan wines. In2011, the trade between Belarus andMoldova amounted to $319.7mn, up by28.3% compared to 2010. Last year theBelarusian export to Moldova rose by46.5% to $242mn while deliveries ofMoldovan goods to Belarus decreasedby 7.4% to $77.7mn.

The range of goods the two countriestrade in is quite extensive and featuresmore than 500 items, of which 388 areBelarusian exports to Moldova. Belarus’

major exports are tractors, buses, trucks,road-building machinery and alsohome appliances, timber, fertilisers,medicines, clothing, furniture, ceramics.

Belarus has traditionally been a con-sumer of Moldovan farm produce,wine and a number of industrial prod-ucts. Moldova supplies Belarus withfresh and canned fruits and vegetables,wines and brandies, corn, sunfloweroil, gypsum, and other products. In2011, Belarus was the biggest con-sumer of Moldovan wines and thesecond biggest importer of Moldovanfruits and vegetables.

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KAZAKHSTAN | TRANSPORT

GE, KTZ and Transmashdiesel inks a pactGE Transportation, a leading global provider of rail, min-ing and transportation-related equipment, JSC NationalCompany Kazakhstan Temir Zholy’s (KTZ) subsidiaryJSC Remlokomotiv and Limited Liability CompanyTransmashdiesel recently inked an agreement. The aim ofthe agreement is to create a joint venture company to pro-duce diesel engines in Astana, Kazakhstan for the Com-monwealth of Independent States (CIS) region, Gazeta.kzreported. The JV Company will build a new 97,000 squarefoot facility to build up to 400 Evolution Series diesel en-gines per year. The plant is scheduled to be operational bythe end of 2014. Evolution Series diesel engines will beutilised in rail, marine and stationary power application inCIS Region. The formation of the JV is subject to variousconditions precedent, including government and regulatoryapprovals. The partners in the JV plan to invest $90 millionin construction of a new diesel engine facility in Astana,Kazakhstan. The new JV intends to manufacture, sell, serv-ice, and provide spare parts for Evolution Series diesel en-gines. KTZ’s wholly owned subsidiary JSC LokomotivKurastyru Zauyty (LKZ) already operates a 460,000 squarefoot locomotive assembly facility in Astana.

TAJIKISTAN | ENERGY

'Hydropower only resource for economic growth' An EU-Central Asia Ministerial meeting was recently heldin the Kyrgyz Republic. It was attended by the ForeignMinisters or Deputy Foreign Ministers of all five countriesof the region (Kazakhstan, Kyrgyzstan, Tajikistan, Turk-menistan and Uzbekistan). The EU delegation was led byEuropean Union foreign-policy chief Catherine Ashton.Topics discussed at the meeting covered range of issues re-lated to security and regional cooperation, energy, environ-ment and water as well as other priority areas of theEU-Central Asia Strategy such as education, rule of law,human rights and initiatives on civil society, Asia-Plus learntfrom the Tajik MFA information department. The partic-ipants also paid emphasis to increasing role of security is-sues. Central Asia’s nations and the European Union haveshared a common view of promotion of security and sta-bility in both regional and global contexts. Other issues wererelated to combat against organized crime, includinghuman trafficking, extremism, terrorism and drug traffick-ing were also discussed at the meeting in Bishkek. Lackingsubstantial energy resources, Tajikistan expressed hope fora domestic source of energy in hydropower. The Tajik del-egation at the meeting gave an overview on the water-and-energy problems.

KAZAKHSTAN | HOSPITALITY

Ritz-Carlton debuts in KazakhstanThe Ritz-Carlton Hotel Company, L.L.C. recently an-nounced the expansion of its luxury hotel portfolio in theCIS with the development of the first hotel in Kazakhstan.The Ritz-Carlton Hotel Co. based in Chevy Chase willopen the hotel in Almaty in late 2013, Gazeta.kz reported.The Ritz-Carlton, Almaty is owned by a subsidiary of Cap-ital Partners L.L.C. Chris Gabaldon, sales and marketingofficer said that the 145-room Ritz-Carlton Almaty is partof Ritz-Carlton’s effort to boost its portfolio from 80 toabout 100 hotels in the next few years. Gabaldon said thatthe hotel in Almaty, Kazakhstan's largest city, “shouldquickly develop as one of the local community’s social andbusiness centres.” The Ritz-Carlton Almaty is in the 37-story Esentai Tower within the mixed use Esentai Park de-velopment project in Almaty which includes an extensiveshopping mall, Fitness Club and residential complexes.


EURASIA

A block upon the house of Facebook TAJIKISTAN |SOCIAL MEDIA

The Tajik Ministry of Communicationsrecently instructed the country’s six mo-bile service providers and six Internetservice providers to block access to face-book, popular social networking site,Asia-Plus reported. Head of the Tajikcommunications service Beg Zukhurovsaid that the authorities in Tajikistanblocked access to Facebook after criticismof the Central Asian country’s leadershipbegan spreading on the popular socialnetworking site.

Zukhurov said that facebook userswere spreading "mud and slander" abouttop government officials, including Pres-ident Emomali Rakhmon, who has ruledTajikistan since 1992 and will run for anew term next year. “These people areobviously paid well for this,” Zukhurovsaid, adding that he had received manyrequests from “indignant Tajik citizensasking that this hotbed of slander beblocked.”

However Zukhurov did not discloseany evidence to support his claims. Thisdevelopment is viewed by political ana-lysts as a silencing tactic used by manystate controlled entities ahead of nextyear’s election, which would see PresidentEmomali Rahmonov extend his reign totwo decades. The former Soviet Repub-

lic has 41,000 Facebook users, which isless than 6% of local Internet users.Among them are the presidential pressservice, the foreign minister, the mayor ofthe country’s capital Dushanbe and otherhigh-ranking officials. This is the secondtime Tajik authorities have blocked theworld’s largest social network.

Access to Facebook was shut for sev-eral days in early March but later re-

opened. In August, the Tajik communi-cations service established a special groupof observers monitoring Tajikistan-re-lated online publications. The group ismade up of volunteers, mainly teachers,students and retirees. Shortly after the"volunteer-run body" started operating,an 18 year-old boy was arrested and in-terrogated for posting criticism of thepresident on his Facebook page.

China enhances military cooperation with Kazakhs KAZAKHSTAN|DEFENCE

Fan Changlong, vice chairman of theCommunist Party of China (CPC) CentralMilitary Commission recently met withAdilbek Dzhaksybekov, Kazakh DefenseMinister, in Beijing. In course of talks, thesenior officials of the two countries' armedforces agreed to military-to-military coop-eration between China and Kazakhstan,Gazeta.kz reported.

Fan said that expansion and strengthen-ing military ties between the two countriesis in the fundamental interests of the twocountries and two peoples, ensuring peaceand stability in the region and the world atlarge. Chinese State Councilor and DefenseMinister Liang Guanglie also had separatetalks with Kazakh minister Dzhaksybekov.

Liang highly valued the healthy and sta-ble development of China-Kazakhstan re-lations, frequent high level visits andgrowing political mutual trust and fruitfulcooperation in various fields.

He said that Chinese armed forces areready to work with the Kazakh counterpartto strengthen bilateral coordination and co-operation. In turn, Dzhaksybekov said thatthe Kazakh Armed Forces are willing to in-crease visits and exchange views with theChinese side, expanding pragmatic coop-eration in several sectors. Dzhaksybekovalso congratulated the success of the 18thCPC national congress. Meantime,Kazakh President Nursultan Nazarbayevand Chinese Vice Premier Wang Qishanalso met in Astana. They discussed the de-velopment of relations between their twocountries, with emphasis on cooperation inenergy, communication and trade.

At the meeting, Wang said that since es-tablishment of diplomatic ties 20 years ago,China and Kazakhstan has maintained agood momentum of development. Henoted that political mutual trust betweenthe two countries has enhanced and bilat-

eral cooperation in various fields are alsomoving ahead.

He outlined that both countries havesupported each other on major issues con-cerning their core interests and closely co-operate in both regional and global affairs.This in turn entailed regional stability andcontributed to the development of bothcountries. He hailed Kazakhstan's strongsupport on issues including cracking downon the "Eastern Turkistan" terrorist forceand assured China’s support to Kazakhstanin its choice of a development path that fitsits national conditions. As an importantplatform for the all-round cooperation be-tween the two countries, the CooperationCommittee Between Kazakhstan andChina gained great results in promotingpragmatic cooperation in a number of areasincluding economy and trade, investment,energy, transportation, finance, culture andsecurity.

Trade turnover with EU sees 42% growthKYRGYSTAN|TRADE

Foreign Affairs Minister of Kyrgyzs-tan Erlan Abdyldayev said that in Jan-uary-September of this year tradeturnover between Kyrgyzstan and theEuropean Union increased by $433million with 42% growth. He madethe announcement at a conference ofthe European Union and Central AsiaForeign Affairs Ministers, Irin-news.org reported.

He informed that since 1996 EU hasoffered an aid worth €450 million to sup-port the social sector and the budget ofKyrgyzstan. He said that Kyrgyzstanconsiders the European Union as one ofthe main economic partners.

All parties at the meeting agreed tocooperate constructively in spheres ofdemocratisation, rule of law, humanrights and development of civil soci-

ety, Abdyldayev said. EU High Rep-resentative for Foreign Affairs and Se-curity Policy, Catherine Ashtonmentioned that EU is willing to en-hance cooperation in education, econ-omy and ecology sectors. She stressedthat diversification is needed in theenergy sector adding that solution ofwater and energy problems is impor-tant both for Central Asia and EU.

The social networking site has been banned in Tajikistan

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RUSSIA|SYRIA

Lavrov to meet oppositionOn 14 December, Russian Foreign Minister Sergei Lavrovwas expected to meet with a Syrian opposition delegation,Deputy Foreign Minister Mikhail Bogdanov said, newsagencies reported. Earlier, the Kremlin lashed out at theUnited States for recognising an opposition coalition as thelegitimate representative of the Syrian people. Lavrovadded that this contradicts the agreements reached inGeneva that suggested the start of dialogue between repre-sentatives appointed by both the Syrian government andthe opposition. Lavrov said Washington’s recognition of theSyrian National Coalition shows the United States is clearlyin favour of the opposition.

RUSSIA|CUSTOMS UNION

Minsk-Moscow integrationRussian Prime Minister Dmitry Medvedev said that inte-gration within the framework of the Union State of Be-larus and Russia is not going to be cancelled. He noted thatdespite the existence of various integration associations inthe post-Soviet space the Union State has achieved a highlevel of integration and should be treasured for it. “The ex-perience accumulated in the Union State, positive and neg-ative alike, is taken into account in the process of Eurasianintegration processes,” he said. Medvedev reminded thatthe present session of the Union State Cabinet was the sec-ond session of the year 2012. The trade turnover betweenRussia and Belarus will be about $40bn this year. This se-rious figure is the result of setting up a Customs Union,Medvedev said on 12 December during a meeting with hisBelarusian counterpart Mikhail Miasnikovich.

RUSSIA|ENERGY

Rosneft, Exxon ink dealOn 13 December, Russian oil major Rosneft and US en-ergy giant ExxonMobil signed a Pilot Development Agree-ment establishing a joint project to assess the possibility ofcommercial production of tight oil reserves at the Bazhenovand Achimov formations in Western Siberia. The agree-ment was signed by Rosneft CEO Igor Sechin and Exxon-Mobil Exploration Company President Stephen Greenlee.ExxonMobil will provide financing of up to $300mn forthe pilot programme, as well as state-of-the-art technolo-gies and specialists in geology, development and well engi-neering and completion.

RUSSIA|ENERGY

LUKoil sells Colombia projectOn 12 December, Russia’s LUKoil Holdings said it was sell-ing its stake in the Condor exploration and development proj-ect in Colombia. Omega Energy Colombia will buy LUKoil'sstake, LUKoil said in a statement. The Condor block is situ-ated in the Andes foothills (Boyaca department) 70 kilometressouth-east of Bogota, the capital of Colombia. The total areaof the block is approximately 3.1 square kilometres.

RUSSIA|ECONOMY

Growth slows in Q3On 10 December, the Federal Statistics Service said grossdomestic product growth slowed in the third quarter to2.9% annually compared with a 5% growth a year ago. Theeconomy ministry trimmed its forecast for growth next yearto 3.6% from 3.7%, saying that a hoped-for rebound in Eu-rope would appear in the second half. Taking a cautiousstance, the Central Bank on 10 December refrained fromraising interest rates as growth risks mounted and hinted atno monetary policy adjustments for the next few months.

On 12 December, Russian PresidentVladimir Putin delivered his annual ad-dress to the Federal Assembly, sayingRussia needs to develop a free marketeconomy based on industry and middlesize business. “The situation when theRussian budget depends on foreign fi-nancial and commodity markets is unac-ceptable,” Putin said.

Most people can’t fulfil their potentialand realise their talents under such con-ditions, he added. “It’s important to re-turn the country to a leading position inkey industries and in middle busi-ness,” Putin stressed. He asked the gov-ernment to prepare “road maps” foraccelerated development of high-techbranches of the economy such as biotech-nologies, rare earth metals, gene engi-neering, urban building and IT.

The measures are crucial for the Russ-ian economy to achieve a 6% growth tar-get, Putin said.

Putin also asked the government todraft proposals to repatriate as much as$1trl in capital held by companies andhigh ranking officials abroad.

Russia should proceed with anti-cor-ruption legislation that would put limitson bureaucrats and politicians owningforeign bank deposits and securities,Putin said today in Moscow in his firststate-of-the-nation address since return-ing to the presidency in May. The curbsshould include all top policy makers in-cluding the president, prime minister andtheir families, he said. “How can you trustan official or politician who makes boldstatements about the wellbeing of Russia,but then tries to move his funds, his cash,abroad?” Putin said. “Property abroadshould be declared regardless, and offi-cials should report its value and also thesource of the income that allowed themto make that transaction.”

Chris Weafer, chief strategist at Sber-bank Investment Bank, wrote in an-mailed note to investors on 12 Decemberthat as expected the speech emphasisedthe continuing uncertainty in the globaleconomy and the need for Russia to re-main cautious against that backdrop.

Putin referred to the current campaignagainst corruption and cited it as one ofthe areas that needs to be improved aspart of Russia’s effort to improve its in-vestment attractiveness. Weafer notedthat Russia is considered to be one of themost corrupt countries in the world. Agroup that tracks global perception of theproblem ranks Russia 143rd out of 183countries.

In a speech that focused heavily on so-cial issues, Putin said that there needs tobe a more effective campaign to boostchild birth and encouraged families tohave more children. According to de-mography experts, Putin observed, thedecision by a family to have a second

child is a potential step toward having athird one. “It’s important that a familyshould make that step,” the Presidentstressed. “I still believe that a family withthree children should become the stan-dard for Russia.”

Putin pointed to the values that Rus-sians were once proud of – “mercy, com-passion and sympathy.” He called thesevalues the very things that have madeRussians unique and strong. "We shoulddo everything to support the institutionsthat are bearers of traditional values," hesaid. The Kremlin leader also promisedto create 25mn new jobs and develop newincentives for teachers, doctors, engineersand others.

Putin called for measures to make iteasier for people to be able to buy afford-able housing. He called for easier accessto home loans. “Russia suffers from ashortage of affordable housing and a largepercentage of existing poor-quality, So-viet-legacy housing,” Weafer wrote. “Suchan expanded programme would combinestrong social policy with good economicsand politics.”

Should there be a more directed pro-gramme to make housing affordable, itwould help the house builders, buildingmaterials suppliers and the consumer sec-tor generally, Weafer wrote. “Real estateis one of our favoured themes for 2013.The sector was one of the best marketperformers in early 2012, but has under-performed since mid-year,” Weafer wrote.

The Russian President also returned toone of the themes he talked a lot aboutafter the 2010 crisis in the agriculture sec-tor. “Russia has become a significant im-porter of food products over the past 20years and Putin has set a target of four tofive years for the country to again becomeself sufficient. There have been a numberof proposals to boost investment in theagriculture sector since 2010, and themost existing opportunities for investorsare via funds or as direct investors,”Weafer wrote.

He noted that Russia’s entry into theWorld Trade Organization (WTO) inAugust also now creates a more definitetimetable against which the Russian in-dustry needs to become more efficientand competitive. “WTO adds greater in-vestment validity to the agriculture story,”he wrote.

Regarding privatisation, Putin said thatthe government is fully committed to theprivatisation programme, but again madeclear that he is opposed to quick salesbelow fair value. “This is also a point heemphasised several times previously thisyear,” Weafer wrote. “What it means isthat the bulk of the planned $100bn,three-five-year privatisation programmeis more likely to take place toward the lat-ter part of that period rather than earlier.Of next year’s $12bn privatisation pro-gramme, $5bn is already taken care ofwith the sale of Rosneft equity to BP aspart of the TNK deal. The bulk of the restis expected to be made up of VTB andAeroflot equity sales. Therefore, thereshould not be any major issuance over-hang from the privatisation programmein 2013,” Weafer wrote.

Putin also called on the Central Bankto think about ways to reduce inflationand create long-term money for theeconomy. “Inflation, along with the highlevel of corruption, is one of the concernscontinuously highlighted in public opin-ion polls,” Weafer wrote.

Turning to politics, Putin once againrejected what he described as attempts toenforce foreign patterns of democracy onRussia and vowed to preserve the nation'sidentity against interference from abroad.

Putin said Russia would follow its ownview on democracy and shrug off any"standards enforced on us from outside.""Direct or indirect foreign interference inour internal political processes is inad-missible," he said. "Those who receivemoney from abroad for their political ac-tivities and serve alien interests shouldn'tengage in politics in Russia."

Putin urges capital repatriation, domestic development

RUSSIA|POLITICS

Russian President Vladimir Putin delivers an annual state of the nation address at the

Kremlin in Moscow, 12 December 2012.

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In the answers to the 154 questions sent by theEuropean Parliament to the Commissionabout the departure of John Dalli, Berlaymontasserted that the correct procedures were fol-lowed.

We can reveal that they were not.Johan Denolf, Chairman of the Supervisory

Committee of the anti-fraud body, OLAF, haswritten a letter to MEP Michael Theurer(ALDE), Chairman of the Committee ofBudgetary Control (CONT) of the EuropeanParliament, where he questioned the legality ofthe procedure followed in the OLAF reportwhich formed the justification by which Pres-ident Jose Barroso dismissed CommissionerJohn Dalli on October 16, 2012.

Besides the violation of the principle of pro-portionality, where the investigation on Dallishould not have been opened at all, there areseveral other violations making the report ob-solete.

It should be added that if OLAF were notunder the pressure of the office of the Presidentof the European Commission (according to thefirst testimony of Giovanni Kessler to CONT)the conclusions of the report might be different,as OLAF would have the time to listen to JohnDalli. We remind our readers that Jose Barrosobased his dismissal decision on the conclusionsof the report which admitted that John Dallidid not receive any bribe and that the TobaccoDirective was not altered, the report claimedcertain “unambiguous circumstantial evidence”

that John Dalli was presumably aware of thebribe attempt and did not report the alleged ap-proach.

John Dalli was never given the opportunityto read the findings of the OLAF report anddefend himself (the legitimate right of the de-fendant according to Arcticle 18 of the OLAFmanual defining the investigative procedures).

Furthermore, after his dismissal, JohnDalli wrote to OLAF asking to re-open theinvestigation in order to present the neces-sary explanations lifting the OLAF hy-pothesis on the “unambiguouscircumstantial evidence,” but OLAF reply(after one month) was negative.

We remind readers that when the fellowCommissioners of Jose Barroso asked him inthe College to give explanations, he reportedlysaid, “the issue is closed, trust me.”

The “Dalli Experiment” has now only one-way of continuing. It is the political, and it willstem from the European Parliament. Here onecan argue that the Parliament cannot add to theongoing European crisis by taking the appro-priate political actions on the matter. This is farfetched and this is the line of defense of the Eu-ropean Commission, but many claim that thisis wrong as the strongest weapon in the battleof Europe is the truth.

Indeed, the future of Europe cannot dependon the future of personalities, which with theiromissions or commissions interpret wronglytheir role.

KASSANDRAThe eventual return of Silvio in politics will opennew avenues for the female population of Europeand a big pain for his EPP colleagues

Page 32 | New Europe16 - 22 December, 2012

[email protected]

Once upon a time in Brussels...

Follow me on twitter @Kassandra_NE

OLAF’s chief supervisor,Denolf, says Dalli reportdid not follow procedure

OLAF DG Giovanni Kessler writes to New EuropeAs a matter of policy, OLAF does not generally comment on rumours and gossippublished from time to time about our work. However, your article publishedtoday (13 December) on the serious issue of the events leading to the resignationof Mr Dalli is so misleading as to require correction. I ask you immediately toplace this reply on your website.

First, I reject your suggestion that OLAF acted under pressure from PresidentBarroso. I made it completely clear to the CONT committee of the EuropeanParliament that I had acted in full independence and without any pressure fromanybody. I also draw to your attention that the Supervisory Committee's princi-pal task is to protect OLAF's independence. The Supervisory Committee has notat any time suggested that OLAF has been subject to political influence in thismatter.

Second, I reject your allegation that OLAF did not "have the time to listen toJohn Dalli". Mr Dalli was interviewed at length on two separate occasions. He hadfull opportunity to comment on all the facts concerning him, as required by Ar-ticle 18 of OLAF's investigation procedures.

Third, you misrepresent the content of the Supervisory Committee's letter to theChairman of the CONT Committee. This letter does not state that the openingof the OLAF investigation violated the principle of proportionality (indeed, theseriousness of the matter is evident from this week's judicial decisions in Malta).Nor does the letter state that there have been any other violations, which make thereport "obsolete" (sic).

On the contrary, the Supervisory Committee have carried out a thorough analy-sis of the investigation on the basis of which they say they have discovered “po-tential problems and issued recommendations" concerning OLAF investigationson which they wish to have a discussion on a “systemic level”. I look forward tostudying and discussing their recommendations once I have received them.

The only specific claim, which is made by the Supervisory Committee in theirletter about the handling of the Dalli case concerns the notification to that Com-mittee of OLAF's intention to forward information to a national judicial au-thority. In general, OLAF notifies the Supervisory Committee five days beforeforwarding information, but the arrangement between OLAF and the Commit-tee allows OLAF to shorten this period when appropriate. In this instance, theCommittee was formally informed two and a half days prior to transmission to theMaltese authorities and was also given full access to the investigation file prior tothis transmission.

As I shall be reminding the Committee, there is no legal obligation on OLAF ei-ther to “consult” the Committee before such transmissions or to delay transmis-sion while the Committee examines the file. Indeed, OLAF has never sought theopinion of the Committee on transmissions to national judiciaries. Nor to myknowledge has the Committee ever provided OLAF with an opinion before trans-mission.

Finally, I take this opportunity to share with your readers my satisfaction that therapid and thorough investigation, which OLAF has conducted on this matter, hasdemonstrated the value of an independent and effective investigation service tothe Institutions and to the wider European project.

Giovanni Kessler

DALLIGATE

The Denolf letter is below:Dear Mr. Theurer,In response to your letter dated 29.11.2012,the OLAF Supervisory Committee informsyou that it has thoroughly examined the caseconcerning, inter alia, Mr Dalli, in order toassess whether the investigation was con-ducted properly and, in particular, whetherthe investigative independence of OLAF aswell as the fundamental rights and proceduralguarantees of the persons concerned, were re-spected. The Supervisory Committee hasadopted today an opinion on that subjectwhich will be sent to the Director General ofOLAF.In view of the legal obligations imposed onthe Supervisory Committee by Article 8 ofRegulation No 1073/99 to respect the confi-dentiality of the investigation, the Supervi-sory Committee is not in a position to submitthis opinion or its conclusions to the Com-mittee on Budgetary Control, since thiswould reveal elements of the investigation.The Supervisory Committee has carried outan analysis with regard to the opening of theinvestigation (respect of the principle of pro-portionality), the conduct of the investigation(respect of the principle of legality, the prin-ciple of impartiality, the respect of funda-mental rights and procedural guarantees,

respect of personal data protection require-ments) and to the closing of OLAF's inves-tigation.In carrying out this analysis the SupervisoryCommittee has discovered a number of po-tential problems and issued recommenda-tions to the Director General of OLAF inthat regard which require a discussion withhim on a more systemic level about the waysin which OLAF is conducting its investiga-tions.The Supervisory Committee points out aswell that OLAF's final report was transmit-ted to the Maltese national judicial authori-ties before expiry of the period of five daysforeseen for the Committee. This preventedthe Supervisory Committee from carryingout the examination of the respect of funda-mental rights and procedural guarantees inOLAF's investigation prior to the said trans-mission. According to the judgement of theGeneral Court in Case T-48/05, the Super-visory Committee must be consulted prior tosuch transmission for the sake of the protec-tion of fundamental rights.

Yours sincerely,Johan DENOLFChairman of the OLAF Supervisory Committee

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